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Both Bond Sam and Bond Dave have 8 percent coupons, make semlannual payments, and are priced at par value. Bond Sam has four years to
Both Bond Sam and Bond Dave have 8 percent coupons, make semlannual payments, and are priced at par value. Bond Sam has four years to maturity, whereas Bond Dave has 17 years to maturity a. If Interest rates suddenly rise by 2 percent, what is the percentage change In the price of Bond Sam and Bond Dave? (A negatlve answer should be Indiceted by a minus sign. Do not round Intermedlate calculatlons and enter your answers asa percent rounded to 2 declmal places, e.g., 32.16.) b. If rates were to suddenly fall by 2 percent Instead, what would be the percentage change In the price of Bond Sam and Bond Dave? (Do not round Intermediate calculatlons and enter your answers as a percent rounded to 2 declmal places, e.g., 32.16.) a. Bond Sam 96 18.04 % 96 20.95 % Bond Dave b. Bond Sam Bond Dave
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