(Answered) A five-year bond with a yield of 11 continuously compounded

Economics

A five-year bond with a yield of 11% (continuously compounded) pays an 8% coupon at the end of each year.

a) What is the bond's price?

b) What is the bond's duration?

c) Use the duration to calculate the effect on the bond's price of a 0.2% decrease in its yield.

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Business Economics, Economics

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