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1. Nov, 2005 #2. Calculate the Macaulay duration of an eight-year 100 par value bond with...
Sue buys a 10 year 1000 bond at par. The Macaulay duration is 8.329 years using...
Sue buys a 10 year 1000 bond at par. The Macaulay duration is 8.329 years using an annual effective interest rate of 6.8%. a. Calculate the estimated price of the bond, using the first-order modified approximation if the interest rate rises to 7%.
2. May, 2005 #3 A bond will pay a coupon of 100 at the end of...
2. May, 2005 #3 A bond will pay a coupon of 100 at the end of each of the next three years and will pay the face value of 1000 at the end of the three-year period. The bond's duration (Macaulay duration) when valued using an annual effective interest rate of 20% is X. Calculate X. (A) 2.61 (B) 2.70 (C) 2.77 (D) 2.89 (E) 3.00
A 3 year, 1000 par value bond has 8% annual coupons and an annual effective yield...
A 3 year, 1000 par value bond has 8% annual coupons and an annual effective yield of 7%. Find the Macaulay duration of this bond.
Question 20 Not yet answered Points out of 2.5 P Flag question What is the Macaulay...
Question 20 Not yet answered Points out of 2.5 P Flag question What is the Macaulay duration of a five year 2000 par value bond with 8% annual coupons and an effective rate of interest equal to 7%? Select one: A. 4.0 B. 4.1 C. 4.2 D. 4.3 ○ E. 4.5
What is the modified duration of a 5-year 2,000 par value bond with 8% annual coupons...
What is the modified duration of a 5-year 2,000 par value bond with 8% annual coupons and an annual effective yield of 7%?
Use the following information for problems 1, 2, 3, and 4: A non-callable $1,000 par- value...
Use the following information for problems 1, 2, 3, and 4: A non-callable $1,000 par- value bond matures in thirty years at par. The annual coupon rate is 5% with coupons payable annually. The bond was purchased at a price to yield an annual effective rate of 4%. 1. (1 point) Find the bond purchase price. 2. (1 point) Calculate the Macaulay duration and the modified duration for this bond. 3. (2 points) Suppose that the market interest rate increases...
possible answers are 0.5%, 1%, 1.5%,2%,2.5% 25. A 15-year bond with annual coupons sold at par...
possible answers are 0.5%, 1%, 1.5%,2%,2.5%
25. A 15-year bond with annual coupons sold at par of 1,000 has a Macaulay duration of 9.0101. If the annual effective yield rate of the bond decreases by x, the price of the bond approximated using the first-order Macaulay approximation is 1,233.72. Calculate x.
1. An investor purchases an annual coupon bond with a 6% coupon rate and exactly 20...
1. An investor purchases an annual coupon bond with a 6% coupon rate and exactly 20 years remaining until maturity at a price equal to par value. The investor’s investment horizon is eight years. The approximate modified duration of the bond is 11.470 years. What is the duration gap at the time of purchase? (Hint: use approximate Macaulay duration to calculate the duration gap) 2. An investor plans to retire in 10 years. As part of the retirement portfolio, the...
"If the investment horizon is equal to the Macaulay duration of the bond, the investor is...
"If the investment horizon is equal to the Macaulay duration of the bond, the investor is hedged against interest rate risk". However, the above statement is only true if interest rates only change before fist coupon payment is received. Using the following bond to show that if interest rate increases 2% between first and second coupon payment dates, the investor is not hedged against interest rate risk even if his duration gap is zero.: A four-year 33.7% annual coupon paying...
Calculate the Macaulay duration of a 10%, $1,000 par bond that matures in three years if...
Calculate the Macaulay duration of a 10%, $1,000 par bond that
matures in three years if the bond's YTM is 12% and interest is
paid semiannually.
Calculate this bond's modified duration (years). Do not round
intermediate calculations. Round your answer to two decimal
places.
Assuming the bond's YTM goes from 12% to 10.5%, calculate an
estimate of the price change. Do not round intermediate
calculations. Round your answer to three decimal places (in %). Use
a minus sign to enter...
Sue buys a 10 year 1000 bond at par. The Macaulay duration is 8.329 years using an annual effective interest rate of 6.8%. a. Calculate the estimated price of the bond, using the first-order modified approximation if the interest rate rises to 7%.
2. May, 2005 #3 A bond will pay a coupon of 100 at the end of each of the next three years and will pay the face value of 1000 at the end of the three-year period. The bond's duration (Macaulay duration) when valued using an annual effective interest rate of 20% is X. Calculate X. (A) 2.61 (B) 2.70 (C) 2.77 (D) 2.89 (E) 3.00
Question 20 Not yet answered Points out of 2.5 P Flag question What is the Macaulay duration of a five year 2000 par value bond with 8% annual coupons and an effective rate of interest equal to 7%? Select one: A. 4.0 B. 4.1 C. 4.2 D. 4.3 ○ E. 4.5
Use the following information for problems 1, 2, 3, and 4: A non-callable $1,000 par- value bond matures in thirty years at par. The annual coupon rate is 5% with coupons payable annually. The bond was purchased at a price to yield an annual effective rate of 4%. 1. (1 point) Find the bond purchase price. 2. (1 point) Calculate the Macaulay duration and the modified duration for this bond. 3. (2 points) Suppose that the market interest rate increases...
possible answers are 0.5%, 1%, 1.5%,2%,2.5%
25. A 15-year bond with annual coupons sold at par of 1,000 has a Macaulay duration of 9.0101. If the annual effective yield rate of the bond decreases by x, the price of the bond approximated using the first-order Macaulay approximation is 1,233.72. Calculate x.
Calculate the Macaulay duration of a 10%, $1,000 par bond that
matures in three years if the bond's YTM is 12% and interest is
paid semiannually.
Calculate this bond's modified duration (years). Do not round
intermediate calculations. Round your answer to two decimal
places.
Assuming the bond's YTM goes from 12% to 10.5%, calculate an
estimate of the price change. Do not round intermediate
calculations. Round your answer to three decimal places (in %). Use
a minus sign to enter...
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