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Find coupon bond making annual coupon payments

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Reference no: EM132658520

A 14.65-year maturity zero-coupon bond selling at a yield to maturity of 7% (effective annual yield) has convexity of 160.6 and modified duration of 13.41 years. A 40-year maturity 5% coupon bond making annual coupon payments also selling at a yield to maturity of 7% has nearly identical modified duration--13.38 years--but considerably higher convexity of 280.0.

Reference no: EM132658520

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