write my assignment 9139

Problem 2. Betty and Bob buy a 2 year bond with face and maturity value of $100 and coupons of $6, 14, 9, and 5 in that order and is priced to yield 16% per annum compounded semiannually.

           a Compute the price correct to 2 places after the decimal point.

           b Compute the dollar duration, correct to 2 places after the decimal place. You

             must use calculus.

           c Compute the modified duration, correct to 2 places after the decimal place.

             State your answer in years.

           d Compute the Macaulay duration, correct to 2 places after the decimal point, by

              using the previous results. State your answer in years.

           e Compute the Macaulay duration, correct to 2 places after the decimal point, by

                using the definition of Macaulay duration. Compare the results of parts d and

                e.