medium · Quantitative Finance
A 5-year bond with a face value of $1,000 has a duration of 4.5 years and a convexity of 25.
If the market yield increases from 4.0% to 4.5%, what is the estimated percentage change in the bond price?
- -2.25%
- -2.22%
- -4.50%
- 0.03%
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