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(a) If interest rates are 10%, what is the current price of each bond? (b) Interest rates increase to 12%; calculate the new price of

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(a) If interest rates are 10%, what is the current price of each bond? (b) Interest rates increase to 12%; calculate the new price of each bond. (c) Interest rates fall to 8%; calculate the new price of each bond. (d) Estimate which bond is most sensitive to interest rate changes? Explain how the bond characteristics determine the sensitivity of a bond's price to changes in interest rates

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