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INTEREST RATE SENSITIVITY An investor purchased the following 5 bonds. Each bond had a par value...
INTEREST RATE SENSITIVITY
An investor purchased the following 5 bonds. Each bond had a par value of $1,000 and an 10% yield to maturity on the purchase day. Immediately after the investor purchased them, interest rates fell, and each then had a new YTM of 5%. What is the percentage change in price for each bond after the decline in interest rates? Fill in the following table. Round your answers to the nearest cent or to two decimal places. Enter all amounts as positive numbers.
| Price @ 10% | Price @ 5% | Percentage Change | |
| 10-year, 10% annual coupon | $ | $ | % |
| 10-year zero | |||
| 5-year zero | |||
| 30-year zero | |||
| $100 perpetuity |
Solutions
Expert Solution
The following are the data inputs in spreadsheet:
The following are the obtained results in spreadsheet:
jeff jeffy answered 1 year agoRelated Solutions
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An investor purchased the following five bonds. Each bond had a par value of $1,000 and...
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par value of $1,000 and a 8% yield to maturity on the purchase day.
Immediately after the investor purchased them, interest rates fell,
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An investor purchased the following five bonds. Each bond had a par value of $1,000 and...
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par value of $1,000 and a 9% yield to maturity on the purchase day.
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and each then had a new YTM of 5%. What is the percentage change in
price for each bond after the decline in interest rates? Fill in
the following table. Enter all amounts as positive numbers. Do not
round intermediate calculations. Round your monetary answers to...
An investor purchased the following five bonds. Each bond had a par value of $1,000 and...
An investor purchased the following five bonds. Each bond had a
par value of $1,000 and an 8% yield to maturity on the purchase
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fell, and each then had a new YTM of 6%. What is the percentage
change in price for each bond after the decline in interest rates?
Fill in the following table. Enter all amounts as positive numbers.
Do not round intermediate calculations. Round your monetary answers
to...
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at
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