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A corporate bond with a coupon rate of 8 . 1 percent has 1 3 years left to maturity. It has had a credit rating
A corporate bond with a coupon rate of percent has years left to maturity. It has had a credit rating of BBB and a yield to maturity of percent. The firm has recently gotten into some trouble and the rating agency is downgrading the bonds to BB The new appropriate discount rate will be percent. Assume interest payments are semiannual.
What will be the change in the bonds price in dollars?
What will be the change in the percentage?
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