Question
Zero-coupon Bond Year Price A 1 979.09 B 2 921.72 C 3 831.68 D 4 782.12 Consider the following zero-coupon bonds, each of which has
Zero-coupon Bond | Year | Price |
A | 1 | 979.09 |
B | 2 | 921.72 |
C | 3 | 831.68 |
D | 4 | 782.12 |
Consider the following zero-coupon bonds, each of which has a par value of $1,000: Zero-coupon Bond Year Price A 1 979.09 B 2 921.72 C 3 831.68 D 4 782.12
d) What is the price of a 4-year maturity bond with a 6% coupon rate paid annually? (Par value = $1,000). e) Given the answer to question (d), calculate the yield to maturity for this 4-year coupon bond. f) Calculate the duration of the above 4-year coupon bond. g) If the market yield changes by 0.05% in the next few minutes, what is the expected percentage price change of the bond over the next few minutes?
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