Calculate the duration of a bond, Finance Basics

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Calculate the duration of a bond

Calculate the duration of a bond that matures exactly in 5 years. Par value is $1000, coupon rate is 10% (annual). It has a YTM of 6%.

a. What will be the selling price?

b. What is the Duration of this bond?

c. If YTM were to be 12%, will the duration increase or decrease or stay the same? Give your reasoning.

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Finance Basics: Calculate the duration of a bond

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Finance Basics: Calculate the duration of a bond

Reference No:- TGS042817

Have a Question? (oR Write a Review)

Recent Questions Asked Finance Basics

Q : Financing activiies on the statement of cash flows

Q : What will happen if demand increases and supply decreases

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Request for Solution File

Ask an Expert for Answer!!

Finance Basics: Calculate the duration of a bond

Reference No:- TGS042817

Recent Questions Asked Finance Basics

Q : Financing activiies on the statement of cash flows

Q : What will happen if demand increases and supply decreases

Q : Which interpretation would you expect each party to prefer

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