Which of the Following Is Closest to the Duration of a 2-Year

question 1

Multiple Choice

Which of the following is closest to the duration of a 2-year bond that pays a coupon of 8% per annum semiannually? The yield on the bond is 10% per annum with continuous compounding.

• A) 1.82
• B) 1.85
• C) 1.88
• D) 1.92

---

Definitions:

Doubled

Increased by 100 percent or made twice as large in size, amount, or number.

Misconceptions

Incorrect beliefs or ideas resulting from misunderstanding, misinformation, or incomplete knowledge about a subject or topic.

Islam

A monotheistic Abrahamic religion based on the Quran, which Muslims believe to be the word of God as revealed to Prophet Muhammad.

Way of Life

The manner in which a person or group lives, including their routines, habits, and cultural practices, often unique to a particular community or society.