1.Calculate the Macaulay duration of an 8 percent, $1,000 par bond that matures in three...
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1.Calculate the Macaulay duration of an 8 percent, $1,000 par bond that matures in three years if the bonds YTM is 10 percent and interest is paid semiannually.
a. Calculate this bonds modified duration.
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b. Assuming the bonds YTM goes from 10 percent to 9.5 percent, calculate an estimate of the price change.
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