onsider a $7\%(2)$ bond which matures in $3$ years. The face value is $$100,$ the desired

yield $8\%(2).$

$($a$)$ Draw the cash flow chart of the bond.

$($b$)$ Using the definition $($and not the formula$),$ find the duration of the bond.

$($c$)$ Using price sensitivity formula, find the approximate price when the yield changes to

$9\%$ and $7\%,$ respectively.

$($d$)$ Is there any difference in change of price? If so$,$ why?