A bond of the Kanon corporation has the following charactaristic :

Maturity 11 years

Coupon 10 percent

yield to maturity 10.5 percent

Macauly duration 5.5 yeasr

convexity 49

noncallable

1. calculate the approximate price change for this bond using only its durration , assuming its yiled to maturity increased bu 150 basis point discuss without calculation the impact when you include the convexity effect

2. Calculate the approximate price change this bond using only duration , if its yield to maturity declined by 300 basis pounts.