Question

Assume the following measure of price volatility Bond price volatility = (Ending price of bond /...

Assume the following measure of price volatility Bond price volatility = (Ending price of bond / Beginning price of bond) -1 What is the price volatility of a twelve-year, 8%, $1,000 par value, when the yield to maturity increases from 5% to 7%? (Interest is paid annually).

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Answer #1

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