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The duration of a bond portfolio worth $500,000 is 2 years and its convexity is 10. By approximately how much does the value of the
The duration of a bond portfolio worth $500,000 is 2 years and its convexity is 10. By approximately how much does the value of the portfolio change if all yields decrease by 0.1%?
a. Decrease of $1,002.50 b. Decrease of $997.50 c. Increase of $997.50 d. Increase of $1,002.50
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