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What is the duration of bond

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Reference no: EM133112147

Consider the following two bonds: Bond ABC: 3% coupon rate, 5% ytm, and 7 years to maturity Bond XYZ: 8% coupon rate, 6% ytm, and 7 years to maturity Both bonds pay coupons annually and have a face value of $1,000.

You are forming a bond portfolio of 2 ABC bonds and 3 XYZ bonds.

(a) What is the duration of each bond?

(b) What is the ytm of your bond portfolio?

(c) What is the duration of your bond portfolio?

Reference no: EM133112147

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