Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The duration of a coupon bond when the interest rate is 1 0 percent is 6 . 0 1 years. What is the precent change

The duration of a coupon bond when the interest rate is 10 percent is 6.01 years. What is the precent change in the price of the bond if the interest rate falls to 8.5 percent? Assume the bond pays ANNUAL coupons.
Enter answer as a % to 2 decimal places. e.g enter 0.03568 as 3.57%, but DO NOT ENTER the % sign.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Management

Authors: Rajiv Srivastava, Anil Misra

2nd Edition

0198072074, 9780198072072

More Books

Students also viewed these Finance questions

Question

define and assess job burnout, boredom at work and work engagement;

Answered: 1 week ago