3. Bond price elasticity Suppose you want to compare the price sensithity of two 10-year bonds. Suppose the US. announces that if expects the unemployment rate to inorease significanty this year, which resulks in an investar's required rate of return en a bond to decrease to 6% Uhing this informubion, fid in the values for the percmeage change in bond price, percentoge chunge in k; and bond orice eiastiaty for each bond in the tabie. fegurta rate of retarn sin is bend ta noreate ts 11 th. fasms an che catculabions, it can be said thyet the bont price siatecity a in ewch ecennaria, which infiects Eetween interest rate mevements and bond wrice mevernenci. The asce elasticity of boad 3 with a required rate of cecurn of 1t perctit can be inarpreted as: A. 1.persent ingease in interest rates ieads to a 0.454 peroent increase in the price of the bond. A I peroent incoasi in interest rates leads to a 6.506 percent decrease in the proe of the bond. A 1 percent increase in interest rates leass to a 0.454 peroent decrease in the price of the bond. A. percett decrease in interest rates lendt to a 0.454 percent dectease in the price of the bond. Aased on the cakuations, it cant be said that a bond with a high recured rate af return it price sensative that a bend a tol a low teesuined fate ut retum