A Bond Has a Macaulay Duration of 4

question 85

Multiple Choice

A bond has a Macaulay duration of 4.5, a yield to maturity of 5.1%, a coupon rate of 6.0%, and semiannual interest payments. What is the bond's modified duration?

• A)6.11 years
• B)6.39 years
• C)6.92 years
• D)7.06 years
• E)7.26 years

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Definitions:

Pulmonary Function Test

A group of tests that measure how well the lungs take in and release air and how well they move gases such as oxygen from the atmosphere into the body's circulation.

Urinalysis

An analysis of the urine; a test performed on urine to determine its characteristics.

Audiometer

A device to measure the degree of hearing ability.

Rinne Test

A hearing test that compares air conduction to bone conduction of sound, used to evaluate loss of hearing in one or both ears.