Bond XYZ is a 4-year, 8% annual coupon bond, with $1,000 par value. The required return...

Bond XYZ is a 4-year, 8% annual coupon bond, with $1,000 par value. The required return on the bond is 5.4%. 1)What is the duration, 2) What is the modified duration of this bond?

Expert Solution

1. Duration= 3.59678 Years

2. Modified Duration= 1.79839 Years

Calculation as follows:

jeff jeffy answered 1 year ago

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