Question

Calculate the requested measures for the bond with the following information. Coupon rate 4% Yield to...

Calculate the requested measures for the bond with the following information.

Coupon rate

4%

Yield to maturity

3%

Maturity (years)

2

Face value

$100

a. Macaulay duration

b. Modified duration

c. Price value of a basis point (DV01)

d. The approximate bond price estimated using modified duration if the yield increases by 35

basis points

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