If the level of interest rates which is currently 8 goes


1. You own a fixed income asset with a duration of five years. If the level of interest rates, which is currently 8%, goes down by 10 basis points, how much to expect the price of the asset to go up, in percentage terms?

2. If duration is 10 years, and the yield to maturity is 7%, what is the modified duration?

3. Change in YTM is 2%. YTM is 8%. Duration is 15 years. What is the percentage price change of the bond?

4. 12 years to maturity. Yield is 7%. Par is 1000. Coupon is $100 in semiannual payments. What is the duration?

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Financial Management: If the level of interest rates which is currently 8 goes
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