Interest Rate Risk. Consider two bonds, a 3-year bond paying an annual coupon of 5% and a 10-year bond also with an annual coupon of 5%. Both currently sell at face value. Now suppose interest rates rise to 10%. (LO6-3) What is the new price of the 3-year bonds? What is the new price of the 10-year bonds? Do you conclude that long-term or short-term bonds are more sensitive to a change in interest rates