Consider the following bonds: Coupon Rate (annual payments) 0% Maturity (years) Bond 15 10 0% 4% 8% a. What is the percentage change in the price of each bond if its yield to maturity falls from 6% to 5%? b. Which of the bonds A-D is most sensitive to a 1% drop in interest rates from 6% to 5%? Which bond is the least sensitive? Par value Old YTM New YTM $1,000 6% 5% a. What is the percentage change in the price of each bond if its yield to maturity falls from 6% to 5%? Annual Coupon Percentage Change Coupon Rate Old Price New Price Rank Bond 0% Maturity 15 10 0% 4% 8% 10 Which of the bonds A-D is most sensitive to a 1% drop in interest rates from 6% to 5%? Which bond is the least sensitive? Bond Bond is the most sensitive to changes in bond yields. is the least sensitive to changes in bond yields