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Interest rate and return

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Calculate the duration of a $1,000, 6% coupon bond with three years to maturity.;Assume that all market interest rates are 7%.;Compute for Semi-Annual and Annual coupons;(You may use the Excel function DURATION: Hint: In Excel DURATION(TODAY();TODAY()+3*365, 0.06, 0.07,1) = 2.831. Alternatively you can compute the sum of the;time weighted PV of the Cashflows etc.);Answer A;SettlementDate;Maturityinthreeyaers;Duration;CouponBond;Martuiry3years;Marketinterestrate;Duration;Duration;Answer B;28Nov14;27Nov17;$;1,000.00;6%;7%;?;1.9575

 

Paper#17905 | Written in 18-Jul-2015

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