Assume we have a 15 year 10.23% coupon bond selling for $1,000 and callable at par with semi-annual compounding. What would be the effective duration if the interest rates could change by 50 basis points (annually)? Please enter your answer to the nearest hundredth (in other words if you calculate a duration of 1.23456 years, you must enter at least 1.23). 49.72

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter5: The Time Value Of Money
Section: Chapter Questions
Problem 11P
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Assume we have a 15 year 10.23% coupon bond selling for $1,000 and callable
at par with semi-annual compounding. What would be the effective duration if
the interest rates could change by 50 basis points (annually)? Please enter your
answer to the nearest hundredth (in other words if you calculate a duration of
1.23456 years, you must enter at least 1.23).
49.72
Transcribed Image Text:Assume we have a 15 year 10.23% coupon bond selling for $1,000 and callable at par with semi-annual compounding. What would be the effective duration if the interest rates could change by 50 basis points (annually)? Please enter your answer to the nearest hundredth (in other words if you calculate a duration of 1.23456 years, you must enter at least 1.23). 49.72
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