A bond with a coupon rate of 10 percent sells at a yield to maturity of 12 percent. If the bond matures in 12 years, what is the Macaulay duration of the bond? What is the modified duration? (Do not round intermediate calculations. Round your answers to 3 decimal places.) Answer is complete but not entirely correct. Duration Macaulay 7.180 X years Modified 6.420 X years
A bond with a coupon rate of 10 percent sells at a yield to maturity of 12 percent. If the bond matures in 12 years, what is the Macaulay duration of the bond? What is the modified duration? (Do not round intermediate calculations. Round your answers to 3 decimal places.) Answer is complete but not entirely correct. Duration Macaulay 7.180 X years Modified 6.420 X years
Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter4: Bond Valuation
Section: Chapter Questions
Problem 17P: Bond Value as Maturity Approaches An investor has two bonds in his portfolio. Each bond matures in 4...
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