Assume the following characteristics of a bond: Selling at 96.000, 2.5% coupon, annual pay, determine the Approximate Modified duration and Approximate Convexity Measure of the bond (I suggest using...

For time value of money calculations (circle all that apply):

1. Increasingi increases present value


2. Increasingiincreases future value


3. More frequent compounding increases future value


4. More frequent discounting increases present value


5. 
   n is always expressed in years

Extracted text: Assume the following characteristics of a bond: Selling at 96.000, 2.5% coupon, annual pay, determine the Approximate Modified duration and Approximate Convexity Measure of the bond (I suggest using 10 bps as the annual change in yield). Now, under the assumption that yields will increase by 60 bps, what do expect to be the new price of the bond? 12 years until maturity. Use the short-cut methods to you