What is the bonds price and what is the bonds duration

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Reference no: EM13732313

A 5-year bond with YTM of 12% and par value of $1000 pays an 8% annual coupon.

a) What is the bond’s price?

b) What is the bond’s duration?

c) Use the duration to calculate the effect of 0.2% increase in the market interest rate on the bond’s price.

d) Recalculate the bond’s price on the basis of a 12.2% YTM.

Reference no: EM13732313

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