Compute the effective duration of a bond


Question1: Compute the effective duration of a bond to a 100 basis point change in interest rates with a 6-1/4 coupon, 10-years remaining to maturity, & an asking quote of 110.7811 [decimal, not 32nds].

Question2: Compute the effective convexity to a 100 basis point change of the bond in Question 1.

Question3: Compute the total percentage price change [duration & convexity] to a 65 basis point decrease in interest rates for the bond in Questions 1 and 2.

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Finance Basics: Compute the effective duration of a bond
Reference No:- TGS018832

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