A bond with 1000 par value is priced to yield 10 its, Ask an Expert

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A bond with $ 1000 par value is priced to yield 10 %. Its duration is 5 and its convexity is 4 (you can assume a market price of $700).

A. Calculate the change in price of this bond accounting for both duration and convexity at 11 %.

- State if it would be a rise or a fall in price.

B. Calculate the change in price of this bond accounting for both duration and convexity at 9 %.

- State if it would be a rise or a fall in price.

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92419931

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