You are holding a $5-$year bond with a $6\%$ annual coupon rate, an $8\%$ yield to maturity and a

$$1,000$ par value. Coupons are paid annually.

A$.$ How much will the bond price change if the market yield falls by $1\%?$

B$.$ Calculate the duration of this bond when the yield to maturity is $8\%.$

C$.$ What are the predicted bond prices when you use duration? How large is prediction error in

percentage?