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Chapter 9 Problem10 (10%): U.S. Treasury quotes as follows: U.S. Treasury quotes from the WSJ...

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Chapter 9 Problem10 (10%): U.S. Treasury quotes as follows: U.S. Treasury quotes from the WSJ on Oct. 15, 2003: Rate Maturity Ask Change Ask yield 7.1250 Oct 15, 2005 102:08 5.9156 a. What is the duration of the above Treasury note? Use the asked price to calculate the duration. Recall that Treasuries pay interest semiannually. -1 b. If yields increase by 10 basis points, what is the approximate price change on the $100,000 Treasury note? Use the duration approximation relationship. Briefly discuss. = = = = = = = = = =

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