Forest Products has two bonds outstanding.

Bond A has a maturity of 5 years, a coupon rate of 5.5 percent, paid semiannually, and a face value of $1,000. It is trading at 7.40% YTM.

Bond B has a maturity of 10 years, a coupon rate of 5.5 percent, paid semi-annually, and a face value of $1000. It is trading at a price of $867.393.

Given this information, answer the following questions:

A. What is the current price of Bond A? Show your work below:

B. What is the YTM of Bond B today? Show your work below:

C. Which of the two bonds has higher interest rate risk? In a few words explain why.