Q 14-3 A bond is purchased at a redemption value of 1,000, and due in 5 years. (a) It has a 5% annual coupon rate payable semi-annually. Find the (Macaulay) duration of the bond if it is purchased to yield 7% compounded semiannually. (b) Suppose the bond is purchased at par, that is, it has coupon and interest rate are the same, denoted by :(2). Both are assessed semiannually. Find an expression for the Macaulay duration of the bond at the time of purchase. Answer: 4.4576 / 4.1583