Jim Goodwin bought a Zero Coupon Bond that has 6 years to
Maturity that pays no coupons, and has a $1,000 maturity value. Similar bonds are paying an 8% market rate. What is the price of the bond, and what is its duration?
A) Price of $630.20, and duration of 6 years.
B) Price of $1,000, and duration of 6 years.
C) Price of $630.20, and duration of 5 years.
D) Price of $850, and duration of 5 years.
Correct Answer:
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