Calculate the bond macaulay duration

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Reference no: EM132018882

Lucky Star Inc. just issued a bond with the following characteristics:

Maturity = 3 years

Coupon rate = 8%

Face value = $1,000

YTM = 10%

Interest is paid annually and the bond is noncallable.

Calculate the bond’s Macaulay duration? Round "Present value" to 2 decimal places and "Duration" to 4 decimal place.?

Calculate the bond’s modified duration.

Assuming the bond’s YTM goes from 10% to 9.5%, calculate an estimate of the price change without considering convexity.

Calculate the convexity of the bond.

Reference no: EM132018882

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