Calculate the percentage price change forecasted by effective duration for both the CIC and PTR
QUESTION
CFA Examination Level II
Patrick Wall is considering the purchase of one of the two bonds described in the following table. Wall realizes his decision will depend primarily on effective duration, and he believes that interest rates will decline by 50 basis points at all maturities over the next six months.
BOND DESCRIPTIONS
Characteristic
CIC
PTR
ANSWER:
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