A $100 000 bond has a term to maturity of two years,with half-yearly coupons set at 4% p.a.Calculate the duration of the bond in periods if the yield is 5%.

A) $ 3.714 $
B) $ 3.886 $
C) $ 3.827 $
D) $ 3.831 $

Name: A $100 000 bond has a term to maturity of two years,with half-yearly coupons set at 4% p.a.Calculate the duration of the bond in periods if the yield is 5%. A) $ 3.714 $ B) $ 3.886 $ C) $ 3.827 $ D) $ 3.831 $
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Question

A $100 000 bond has a term to maturity of two years,with half-yearly coupons set at 4% p.a.Calculate the duration of the bond in periods if the yield is 5%.

A) $ 3.714 $
B) $ 3.886 $
C) $ 3.827 $
D) $ 3.831 $

Quizplus · Accepted Answer

The present value (PV)of the first cash flow = 3.886.

A $100 000 Bond Has a Term to Maturity of Two