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By calculating the duration for the following bonds decide which has a higher duration. The first...

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Finance

By calculating the duration for the following bonds decide whichhas a higher duration. The first bond is a 2 year $1000 zero couponbond. The second is a 3 year $1000 bond that pays an annual couponof 10%. Suppose the YTM is 8%

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3.9 Ratings (433 Votes)
Duration for 0 bond is time to maturity 2 for the 0 couponbondK NBond Price Coupon1 YTMk Par value1    See Answer
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Transcribed Image Text

By calculating the duration for the following bonds decide whichhas a higher duration. The first bond is a 2 year $1000 zero couponbond. The second is a 3 year $1000 bond that pays an annual couponof 10%. Suppose the YTM is 8%

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