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For simplicity, assume that a bank currently has the balance sheet in the table below You are considering to issue $50 million long-term bonds to
For simplicity, assume that a bank currently has the balance sheet in the table below You are considering to issue $50 million long-term bonds to meet its funding requirements among the following two bonds available for possible change in future interest rate. Bond I: 3-year zero-coupon bonds yielding 6% Bond II: 5-year 6% annual coupon bonds yielding 6% 1. Calculate Macaulay duration of each bond.
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