Calculate the value of duration for a four year, $1,000 par value U.S. government bond purchased today at a yield to maturity of 15 percent.

Calculate the value of duration for a four year, $1,000 par value U.S.
government bond purchased today at a yield to maturity of 15 percent. The
bond s coupon rate is 12 percent, and it pays interest at year s end. Now
suppose the market interest rate on comparable bonds falls to 14 percent. What
percentage change in this bond s price will result?








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