i, would you help me to solve question 2 below? I know it is a semi-annual bond but I'm not sure about how to caluculate the PV of the coupon payments and its face value. Thank you very much! You have a semi-annual bond with 25 years to maturity with a 10% coupon rate and par value of £1000. The current YTM of the bond is 10%, the modified duration is 9.12 and the convexity is 141.03. What is the percentage price change if interest rate were to fall 125 basis points considering both duration and convexity? What is the estimated price with 125 basis points decrease in Yield?

i, would you help me to solve question 2 below? I know it is a semi-annual bond but I'm not sure about how to caluculate the PV of the coupon payments and its face value. Thank you very much! You have a semi-annual bond with 25 years to maturity with a 10% coupon rate and par value of £1000. The current YTM of the bond is 10%, the modified duration is 9.12 and the convexity is 141.03. What is the percentage price change if interest rate were to fall 125 basis points considering both duration and convexity? What is the estimated price with 125 basis points decrease in Yield?

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter4: Bond Valuation

Section: Chapter Questions

Problem 8MC: Suppose a 10-year, 10% semiannual coupon bond with a par value of 1,000 is currently selling for...

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