Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Today is 15 May 2021. Stphanie has just purchased a Treasury bond with a face value of $100, maturing at par and paying coupon at
Today is 15 May 2021. Stphanie has just purchased a Treasury bond with a face value of $100, maturing at par and paying coupon at j2 = 3.4% p.a. The maturity date of this bond is 15 May 2023. Assume that we do not know her purchase price. c) Calculate the duration of this Treasury bond. Assume the yield rate is j2 = 7.87% p.a. Give your answer in terms of years, rounded to four decimal places.
a.
3.8867
b.
3.8959
c.
1.9479
d.
1.9434
Answer must be exact (cannot be different due to rounding errors) or else it is incorrect. thanks!
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started