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20. Compute the duration for bond C, and rank the bonds on the basis of their price volatility. The current rate of interest is 8
20. Compute the duration for bond C, and rank the bonds on the basis of their price volatility. The current rate of interest is 8 percent, so the prices of bonds A and B are $1,000 and $1,268 respectively. Bond Coupon Term Duration A 8% 10 years 7.25 B 12% 10 years 6.74 C 8% 5 years ? Confirm your ranking by calculating the percentage change in the price of each bond when interest rates rise from 8 to 12 percent. (Bond A
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