Consider three bonds with 5 60 coupon rates, all making annual coupon payments and all selling at face value The short term bond has a maturity of 4 years, the intermediate term bond has a maturity of 8 years, and the long term bond has a maturity of 30 years What will be the price of the 4 year bond if its yield increases to 6 60 Note Do not round intermediate calculations Round your answer to 2 decimal places What will be the price of the 8 year bond if its yield increases to 6 60 Note Do not round intermediate calculations Round your answer to 2 decimal places What will be the price of the 30 year bond if its yield increases to 6 60 Note Do not round intermediate calculations Round your answer to 2 decimal places What will be the price of the 4 year bond if its yield decreases to 4 60 Note Do not round intermediate calculations Round your answer to 2 decimal places What will be the price of the 8 year bond if its yield decreases to 4 60 Note Do not round intermediate calculations Round your answer to 2 decimal places What will be the price of the 30 year bond if its yield decreases to 4 60 Note Do not round intermediate calculations Round your answer to 2 decimal places Comparing your answers to parts (a), (b), and (c), are long term bonds more or less affected than short term bonds by a rise in interest rates Comparing your answers to parts (d), (e), and (f), are long term bonds more or less affected than short term bonds by a decline in interest rates

Question

Consider three bonds with 5 60  coupon rates, all making annual coupon payments and all selling at face value  The short term bond has a maturity of 4 years, the intermediate term bond has a maturity of 8 years, and the long term bond has a maturity of 30 years  What will be the price of the 4 year bond if its yield increases to 6 60   Note  Do not round intermediate calculations  Round your answer to 2 decimal places  What will be the price of the 8 year bond if its yield increases to 6 60   Note  Do not round intermediate calculations  Round your answer to 2 decimal places  What will be the price of the 30 year bond if its yield increases to 6 60   Note  Do not round intermediate calculations  Round your answer to 2 decimal places  What will be the price of the 4 year bond if its yield decreases to 4 60   Note  Do not round intermediate calculations  Round your answer to 2 decimal places  What will be the price of the 8 year bond if its yield decreases to 4 60   Note  Do not round intermediate calculations  Round your answer to 2 decimal places  What will be the price of the 30 year bond if its yield decreases to 4 60   Note  Do not round intermediate calculations  Round your answer to 2 decimal places  Comparing your answers to parts (a), (b), and (c), are long term bonds more or less affected than short term bonds by a rise in interest rates  Comparing your answers to parts (d), (e), and (f), are long term bonds more or less affected than short term bonds by a decline in interest rates

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Consider three bonds with 5.60% coupon rates, all making annual coupon payments and all selling at face value. The short-term bond has a maturity of

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