5-10 Bond J has a coupon rate of 3 percent. Bond K has a coupon rate of 9%. Both bonds have 19 years to maturity, make semiannual payments, and have a YTM of 6%. If interest rates suddenly rise by 2%, what is the percentage price change of these bonds? What if rates suddenly fall by 2% instead? All bond price answers should be dollar prices. ENTER ANSWERS AS AN EQUATION: Bond J: Coupon rate Settlement date Maturity date Redemption (% of par) # of coupons per year 5 5 Bond K: Coupon rate 3 Settlement date Maturity date ORedemption (% of par) 1# of coupons per year 3 Par value for both bonds 4 Current YTM 5 New YTM 6 New YTM 7 8 3% 1/1/2000 1/1/2019 100 2 9% 1/1/2000 1/1/2019 100 2 $2,000 6% 8% 4% Price at Current YTM: Price of Bond J Price of Bond K Price if YTM increases: Price of Bond J Price of Bond K % change in Bond J % change in Bond K =PRICE Price if YTM decreases Price of Bond J Price of Bond K % change in Bond J % change in Bond K PRICE(settlement, maturity, rate, yld, redemption, frequency, [basis])

5-10 Bond J has a coupon rate of 3 percent. Bond K has a coupon rate of 9%. Both bonds have 19 years to maturity, make semiannual payments, and have a VTM of 6%. If interest rates suddenly rise by 2%, what is the percentage price change of these bonds? What if rates suddenly fall by 2% instead? All bond price answers should be dollar prices