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Walsingham bonds have a $ 1 , 0 0 0 par value, have 2 years remaining until maturity, a 1 2 percent coupon rate (
Walsingham bonds have a $ par value, have years remaining until maturity, a percent coupon rate paid semiannually and a yield to maturity of percent.
a Compute the current price of Walsingham bonds.
b What is the duration of these bonds?
c Use the duration measure to predict the price change in the bond value due to bp decrease in yields.
d What would be the actual price change due to bp decrease in yields?
e What explains the difference between your answer to c and d
f How is duration related to bond maturity, YTM and coupon rate?
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