Question
Both Bond A and Bond B have 9.4 percent coupons and are priced at par value. Bond A has 7 years to maturity, while Bond
Both Bond A and Bond B have 9.4 percent coupons and are priced at par value. Bond A has 7 years to maturity, while Bond B has 20 years to maturity.
a.If interest rates suddenly rise by 2 percent, what is the percentage change in price of Bond A and Bond B?(A negative value should be indicated by a minus sign. Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.)
b.If interest rates suddenly fall by 2 percent instead, what would be the percentage change in price of Bond A and Bond B?(Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.)
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Organisational Behaviour In The Workplace
Authors: Jacqueline Mclean, Laurie Mullins
12th Edition
1292245484, 978-1292245485
