another duration Q plz

[cfa_mixer]

My people.
If there is a single payment in 4 years of say 650,000, then why is the dollar duration formula (4)*(650,000)*(.01)
I do not recall reading anything like this.
Anyone have a good intuitive way of thinking about this?
come mix with me

 

[cfa_mixer]

Ok now that I did some extra reading, I see that there is a formula that says:
dolloar duration = (bond price)*(modified duration/100) which is the same thing I had in original question just rephrased algebraecally (is that how you spell algebraecally?)
Anyway, now I am wondering, why is the duration 4 in this case then? is it because there are no coupon payments? the problem (from CFA lvl 3 exam 2010) just says “single payout in 4 years”.

 

[ABAL]

You are MIXING the duration as in number (?) with duration as in DOLLAR DURATION.

 

[cfa_mixer]

haha, I see what you did there. FIrst time ive ever laughed at an AF post.
yes i did mix it, I edited the proper wording in original post.