A bond with a par value of $/00 matures in /0 years with a coupon of 45% paid semiannually; it is priced to yield 583% and has a modified duration of 78/ If the yield of the bond declines by 025% the approximate percentage price change for the bond is closest to:
Approximate percentage price change = - [7.81×(-0.0025)]=0.01953 or 1.95%.