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A five-year bond with a yield of 9 continuously compounded

A five-year bond with a yield of 9% (continuously compounded) pays a 6% coupon at the end of each year.

(a) What is the bond's price?

(b) What is the bond's duration?

(d) Recalculate the bond's price on the basis of a 8.8% per annum yield and verify that the result is in agreement with your answer to (c).

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Finance Basics: A five-year bond with a yield of 9 continuously compounded

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