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Use the following information for the next 4 questions: A bond with par value of $1,000 pays 8% coupon annually and matures in 5 years.
Use the following information for the next 4 questions: A bond with par value of $1,000 pays 8% coupon annually and matures in 5 years. Its yield to maturity is 6%. a) What is the bond's price?
b) What is the bond's duration?
c) What is the bond's current yield?
d) If the YTM decreases to 5.75%, what is the predicted % change in bond's price using the concept of duration?
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