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ADB Ltd. Has issued a 20% 4-year bond with interest payable annually. The face value...

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Finance

ADB Ltd. Has issued a 20% 4-year bond with interest payable annually. The face value of the bonds is GHC 100,000. The bond will be redeemed at a premium of 10% above par. The yield of similar bonds is 10%. Required: i. Calculate the market value of the bonds. ii. Calculate the duration of the bonds iii. Calculate the volatility of the bond. What does your answer in (iii) mean?

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