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What is the duration of a three-year bond

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Reference no: EM132804676

(a) What is the duration of a three-year bond with face value equal to $100 that pays a coupon of $3 every year. The yield to maturity (y) of the bond equals 6%.

(b) Repeat part (a) when the bond's yield to maturity equals 10%.

(c) Discuss the difference between (a) and (b) using intuition.

Reference no: EM132804676

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