1. Each bond below is trading to offer the same yield to maturity. Rank them from highest to lowest price volatility. Explain your reasoning.

Bond c(%) Maturity (years) X 4 10 Y68 Z 6 10

Part B. Which of the following bonds will have the greater price volatility, assuming that they have the same time to maturity? Explain your reasoning.

Bond c(%) Yield(%) A46 B45

Part C. Consider the following two bonds:

Bond Price Duration A $100 6.5 B $80 7.5

Which bond will have the greater price increase for a 10 basis point decrease in interest rates?