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| rev | Admin | (Created page with "'''Solution: D''' The price of Bond <math>\mathrm{A}</math> is <math>60\left(1.04^{-1}+1.04^{-2}+1.04^{-3}\right)+1000\left(1.04^{-3}\right)=1055.50</math>, while the Macaulay duration of Bond A is <math display = "block">\frac{60\left[1.04^{-1}+2\left(1.04^{-2}\right)+3\left(1.04^{-3}\right)\right]+3(1000)\left(1.04^{-3}\right)}{1055.50}=2.838</math>. Note that the one-year zero-coupon bond has duration 1. Let <math>w</math> denote the proportion of wealth to invest...") | Nov 20'23 at 17:01 | +644 |