Given: A $1000 face-value, 20%-coupon bond with 5 years remaining to maturity, and a yield to...

Given: A $1000 face-value, 20%-coupon bond with 5 years remaining to maturity, and a yield to maturity of 10% What is the duration? _____________________. What is the percent volatility? _________________________.

Expert Solution

Solution :

The Duration of the bond is = 3.7961 years

= 3.80 years ( when rounded off to two decimal places )

The volatility percentage = 3.4510 %

= 3.45 % ( when rounded off to two decimal places )

Please find the attached screenshot of the excel sheet containing the detailed calculation for the solution.

jeff jeffy answered 1 year ago

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