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Question 12 O out of 5 points X + Consider an increasing perpetuity with the first payment equaling $10 and each successive payment increased by
Question 12 O out of 5 points X + Consider an increasing perpetuity with the first payment equaling $10 and each successive payment increased by $10. The present value 10 10 (price function) of this annuity at interest rate i is P() j2_ = 10^-+ +10/-. Determine the value of the modified duration at a yield (interest) rate of i = 9.0% Question 13 O out of 5 points X + Consider an increasing perpetuity with the first payment equaling $1 and each successive payment increased by $1. The present value (price function) of this annuity at interest rate i is P(O) = 1 17 = 11-1 + 17-2. Using a yield rate of i=10% and using the modified (tangent line) appr oximation, approximate the price at a yield rate of 10.4%. Note: calculating the exact price will lead to an incorrect answer. Question 12 O out of 5 points X + Consider an increasing perpetuity with the first payment equaling $10 and each successive payment increased by $10. The present value 10 10 (price function) of this annuity at interest rate i is P() j2_ = 10^-+ +10/-. Determine the value of the modified duration at a yield (interest) rate of i = 9.0% Question 13 O out of 5 points X + Consider an increasing perpetuity with the first payment equaling $1 and each successive payment increased by $1. The present value (price function) of this annuity at interest rate i is P(O) = 1 17 = 11-1 + 17-2. Using a yield rate of i=10% and using the modified (tangent line) appr oximation, approximate the price at a yield rate of 10.4%. Note: calculating the exact price will lead to an incorrect
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