Consider a coupon bond x with value at maturity 150 euro, maturity 10 years, annually paid coupon of 15 euro and priced at parity. Determine the internal rate of return (IRR) and duration of the bond with respect to a flat term structure at the IRR level.

Consider a coupon bond x with value at maturity 150 euro, maturity 10 years, annually paid coupon of 15 euro and priced at parity. Determine the internal rate of return (IRR) and duration of the bond with respect to a flat term structure at the IRR level.

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 14P: Current Yield with Semiannual Payments A bond that matures in 7 years sells for $1,020. The bond has...

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Consider a coupon bond x with value at maturity 150 euro, maturity 10 years, annually paid
coupon of 15 euro and priced at parity. Determine the internal rate of return (IRR) and
duration of the bond with respect to a flat term structure at the IRR level.

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