A bond that pays interest annually has a 6 percent promised yield and a price of $1,025. Annual interest rates are now projected to fall 50 basis points. The bond's duration is six years. What is the predicted new bond price after the interest rate change?

Respuesta :

Answer:

$1,019.64

Explanation:

((−5/1.03) × 0.0050 × $1,045) + $1,045 = 1,019.635