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5.) (2 points) Assume exactly one year ago, you bought a 5% (SA) coupon 10 year bond at a price of $1,000 (par). Assume that
5.) (2 points) Assume exactly one year ago, you bought a 5% (SA) coupon 10 year bond at a price of $1,000 (par). Assume that market interest rates have fallen and that the current market rate of interest rate is 4%. What would your Holding Period Return (HPR) be if you sold the bond today (1 year later)?- 6.) (2 points) Assume you are looking at 2 bonds with the following characteristics. Bond A-2 year bond with a 2% coupon (SA). Par value is $1,000.- Bond B 30 year bond with a 4% coupon (SA). Par value is $1,000.- Assume market interest rates have risen to 3% for Bond A and 5% for Bond B. + By how much (%) did each bond's price decrease? Explain the difference in the results
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