QUESTIONS 97 THROUGH 108 RELATE TO FIXED INCOME INVESTMENTS.

106. An analyst uses a valuation model to estimate the value of an option-free bond at 92.733 to

yield 11%. If the value is 94.474 for a 60 basis point decrease in yield and 91.041 for a 60 basis point

increase in yield, the effective duration of the bond is closest to:

A.

1.85.

B.

3.09.

C.

6.17.