If yields decrease by 0.75%, the convexity adjustment for a bond with an annual convexity of 400 is:A.0.01125.B.0.02250.C.1.50000.

A bond has a modified duration of 6.5 years and an annual convexity of 350. If yields increase by 40 bps, the percentage price change is:A.–2.88%.B.–2.32%.C.–2.04%.

Use the information below to answer questions 28 to 30. Bond C is a 2-year semi-annual bond with a par value of R1000. It has a yield to maturity of 14% and a coupon rate of 10%. Bond C has a convexity of 19.303. Calculate the total effect of Bond C, if the yield to maturity increases by 1%.Select one:a.-1.54%b.1.94%c.-1.94%d.1.54%

f the yield to maturity on an annual-pay bond is 7.75%, the bond-equivalent yield is closest to:A.8.05%.B.7.90%.C.7.61%.

A 30-year maturity bond making annual coupon payments with a coupon rate of 12% has a duration of 11.54 years and a convexity of 192.4. The bond currently sells at a yield to maturity of 8%. Use a financial calculator or spreadsheet to find the price of the bond if its yield to maturity falls to 6% or rises to 13%. What prices for the bond at these new yields would be predicted by the duration rule and the duration-with-convexity rule?

Which of the following bonds has the highest convexity?Question 5Select one:a.A 12%, 15-year coupon bondb.A 12%, 5-year coupon bondc.A 6%, 15-year coupon bondd.A 6%, 5-year coupon bond