Question
Q10 in excel a. A four-year bond pays 10% coupon semiannually. It has a YTM (rate of return) of 8% and duration of 3.42 years.
Q10
in excel
a. A four-year bond pays 10% coupon semiannually. It has a YTM (rate of return) of 8% and duration of 3.42 years. If your required rate of retun increases by 10 basis points (that is 1/10 of 1%) from 8% to 8.10%, what would be the % change in the bond price? Show the price of the bond when rate of retun is 8% and when it increases to 8.10%
b. A four-year bond pays 10% coupon semiannually. It has a YTM (rate of return) of 8% and duration of 3.42 years. If your required rate of retun increases by 10 basis points (that is 1/10 of 1%) from 8% to 8.10%, what would be the % change in the bond price? Show the price of the bond when rate of retun is 8% and when it increases to 8.10%
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The Oxford Handbook Of Pricing Management
Authors: Ozalp Ozer, Robert Phillips
1st Edition
0199543178, 978-0199543175
