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How to do required B1 and B2? MLK Bank has an asset portfolio that consists of $210 million of 15-year, 6 percent annual coupon, $1,000
How to do required B1 and B2?
MLK Bank has an asset portfolio that consists of $210 million of 15-year, 6 percent annual coupon, $1,000 bonds that sell at par. a-1. What will be the bonds' new prices if market yields change immediately by + 0.10 percent? a-2. What will be the new prices if market yields change immediately by + 2.00 percent? b-1. The duration of these bonds is 10.2950 years. What are the predicted bond prices in each of the four cases using the duration rule? b-2. What is the amount of error between the duration prediction and the actual market values? Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required A1 Required A2 Required B1 Required B2 The duration of these bonds is 10.295 years. What are the predicted bond prices in each of the four cases using the duration rule? (Do not round intermediate calculations. Enter all answers as positive numbers. Round your answers to 2 decimal places. (e.g., 32.16)) At + 0.10% $ At - 0.10% At + 2.0% At - 2.0% Bonds' New Price (9.71) X 9.71 X (194.24) X 194.24 X MLK Bank has an asset portfolio that consists of $210 million of 15-year, 6 percent annual coupon, $1,000 bonds that sell at par. a-1. What will be the bonds' new prices if market yields change immediately by + 0.10 percent? a-2. What will be the new prices if market yields change immediately by + 2.00 percent? b-1. The duration of these bonds is 10.2950 years. What are the predicted bond prices in each of the four cases using the duration rule? b-2. What is the amount of error between the duration prediction and the actual market values? X Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required A1 Required A2 Required B1 Required B2 What is the amount of error between the duration prediction and the actual market values? (Do not round intermediate calculations. Enter all answers as positive numbers. Round your answers to 2 decimal places. (e.g., 32.16)) Amount of Error At + 0.10% $ 990.35 At - 0.10% 1,009.78 X At + 2.0% 828.81 x At - 2.0% 1,222.37 XStep by Step Solution
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