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A 25-year bond costs $25,000 today and will pay $1,000 at year-end for the following 25 years. In the final year (T = 25), it also repays $25,000 in principal. (Use 4 decimal places of accuracy when computing durations.)
(a) What is its YTM?
(b) What is its plain duration?
(c) If the yield curve is a flat 3%, what is its Macaulay duration?
(d) If the yield curve is a flat 10%, what is its Macaulay duration?
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