Duration Cont Suppose There Is A 3 Year Bond With A Par Value Of 1 000 A Coupon Rate Of 8 And A Yield To Maturi 1 (47.46 KiB) Viewed 38 times
Duration Cont Suppose There Is A 3 Year Bond With A Par Value Of 1 000 A Coupon Rate Of 8 And A Yield To Maturi 2 (52.79 KiB) Viewed 38 times
Duration (cont.) ■ Suppose there is a 3-year bond with a par value of $1,000, a coupon rate of 8%, and a yield to maturity of 10%. It pays the coupons annually. What is the bond's duration?
Properties of Duration (cont.) At the yield of 15%, the duration of a perpetuity that pays $100 per year is: ■ Bond A has a duration of 2 years and a market value of $1,200; bond B has a duration of 4 years and a current price of $800. What is the duration of a bond portfolio consisting of these two bonds? 20
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