The duration of these bonds is 8.1702 years. What are the predicted bond prices in each of the four cases using the duration rule? (the cases being ± 0.10 percent and ± 2.00 percent)

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter6: Fixed-income Securities: Characteristics And Valuation
Section: Chapter Questions
Problem 13P
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MLK Bank has an asset portfolio that consists of $180 million of 15-year, 10.5 percent annual coupon, $1,000 bonds that sell at par.

b-1. The duration of these bonds is 8.1702 years. What are the predicted bond prices in each of the four cases using the duration rule? (the cases being ± 0.10 percent and ± 2.00 percent)

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