Bullet bond is a bond that pays fixed rate of interest and fully amortizes on the maturity date. These types of bonds are not redeemable prior to maturity. These are non-callable pay regular coupons with a single payment of principal on maturity date.

When you purchase a bullet bond, you are lending money to an issuer who promises to pay you a specified amount of interest and return the principal to you on a specific maturity date. This can be understood by using a 4.75% bond maturing in 10 year as an example,

The price of a bond is the sum of the present values of all expected coupon payments plus the present value of the par value at maturity. As we see with the change in coupon of the bond, having fixed YTM (present interest rate), the price of the bond changes.

Bond Duration is a measurement of the average (cash-weighted) term-to-maturity of a bond.

i.e. Bond Duration = Σ (t*PV)/ Σ (PV)

Modified duration is a measurement of the price sensitivity of a bond to interest rate movements.

It is calculated as:

Modified Bond Duration = (Bond Duration)/ (1+YTM)