A bond has the following features:
a) Inputs:
i) Coupon Rate (6%)
ii) Coupon payments per year (2)
iii) Par value ($100)
iv) Yield to maturity (9%)
v) Settlement date (01/01/01)
vi) Maturity date (01/01/26) (i.e. 25 years to maturity)
Please conduct the sensitivity analyses.
(1) find the Duration of this bond
(2) Examine the sensitivity of a bond’s price to changes in the yield to maturity. Use yield ranging from 1% to 13% in increments of 0.5% (left-hand column).
(3) Examine the sensitivity of a bond’s price to its term to maturity. Use maturities ranging from 5 to 30 years, in increments of 5 years.
(4) Examine the sensitivity of a bond`s duration to changes in the yield to maturity. Use yield ranging from 1% to 13% in increments of 0.5% (left-hand column).