A $1,000 face value bond has a coupon rate of 4.00%, 10 years to maturity, semiannual coupon payments, and a yield to maturity of 8.00%.
A $1,000 face value bond has a coupon rate of 4.00%, 10 years to maturity, semiannual coupon payments, and a yield to maturity of 8.00%. If interest rates suddenly rise by 1.40%, what will be the percentage change in the bond price?
a.
-5.89%
b.
-10.08%
c.
-18.94%
d.
16.45%
e.
22.72%
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Authors: Mike E. Miles, Laurence M. Netherton, Adrienne Schmitz
5th Edition
0874203430, 978-0874203431
