derive the duration of a 3 year semiannual playing 8% bond, when market rates are 10%...

derive the duration of a 3 year semiannual playing 8% bond, when market rates are 10% annually. Explain the concept of duration.

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Derive the duration of a 3 year semiannual paying 8% bond, when market rates are 10%...

Derive the duration of a 3 year semiannual paying 8% bond, when market rates are 10% annually. Explicate the concept of duration.

Find the duration of a 10-year, 8% bond that is trading at a yield of 10%...

Find the duration of a 10-year, 8% bond that is trading at a yield of 10% and pays coupons every 6 months. Please round your numerical answer to two decimal places.

Bond Yields and Rates of Return A 30-year, 10% semiannual coupon bond with a par value...

Bond Yields and Rates of Return A 30-year, 10% semiannual coupon bond with a par value of $1,000 may be called in 4 years at a call price of $1,100. The bond sells for $1,050. (Assume that the bond has just been issued.) What is the bond's yield to maturity? Do not round intermediate calculations. Round your answer to two decimal places. ----------% What is the bond's current yield? Do not round intermediate calculations. Round your answer to two decimal...

Consider a 3-year 8% semiannual coupon bond. The YTM of this bond is 6%. Compute the...

Consider a 3-year 8% semiannual coupon bond. The YTM of this bond is 6%. Compute the following a) Macaulay Duration (use Mac Duration = b) Modified Duration c) Effective duration (assume a ±50 BP change of Yield) d) Convexity Factor (use e) Effective Convexity Factor (assume a ±50 BP change of Yield) PLEASE ANSWER ALL PARTS

a. A 10-year 5% coupon bond has a yield of 8% and a duration of 7.85...

a. A 10-year 5% coupon bond has a yield of 8% and a duration of 7.85 years. If the bond yield increases by 60 basis points, what is the percentage change in the bond price? b. Alpha Insurance Company is obligated to make payments of $2 million, $3 million, and $4 million at the end of the next three years, respectively. The market interest rate is 8% per annum. i. Determine the duration of the company’s payment obligations. ii. Suppose...

You own $10 million of the 8% (semiannual), 10 year Treasury bond priced at par to...

You own $10 million of the 8% (semiannual), 10 year Treasury bond priced at par to yield 8% annually. You want to hedge your position against an increase in yields using the 8% (semiannual), 10 year Treasury bond future. There are no transaction costs. Recall the negative relation between market yields and bond prices. How many Treasury bond futures do you need to hedge the position? Compute and plot the profit & loss on the same diagram (long Treasury bond...

5 year ago, the bond issuer issued a 30-year 7% semiannual bond when the market interest...

5 year ago, the bond issuer issued a 30-year 7% semiannual bond when the market interest rate was 6%. 5 years later, the interest rate changes to 8%, so what is the rate of return for this bond for the last 5 years?

1. What is the price for a $1,000 par, 10 year, 8% coupon bond with semiannual...

1. What is the price for a $1,000 par, 10 year, 8% coupon bond with semiannual payments and a 7% yield to maturity? A. 1,105.94 B. 1,106.78 C. 1,071.06 D. 883.31 E. 907.99 2. What is the price for a $1,000 par, 20 year, 8% coupon bond with semiannual payments and a 9% yield to maturity? A. 1,071.06 B. 1,106.78 C. 1,105.94 D. 907.99 E. 883.31 3. What is the price for a $1,000 par, 20 year, 8% coupon bond...

What is the bond’s Macaulay duration of a 2.5 years, 8 percent semiannual coupon bond selling...

What is the bond’s Macaulay duration of a 2.5 years, 8 percent semiannual coupon bond selling at par of $1,000? A. 2.5 years. B. 2.45 years. C. 1.94 years. D. 2.31 years. E. 1.75 years

A 10-year, 4% semiannual coupon bond with a YTM of 8%, what is its fair value?...

A 10-year, 4% semiannual coupon bond with a YTM of 8%, what is its fair value? Please draw a Price-Interest curve for a 10-year, 4% semiannual coupon bond (Bond value as Y, YTM as X).

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