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Interest Rate Sensitivity A bond trader purchased each of the following bonds with a face value of $1,000 at a yield to maturity of 8%.
Interest Rate Sensitivity
A bond trader purchased each of the following bonds with a face value of $1,000 at a yield to maturity of 8%. Immediately after she purchased the bonds, interest rates fell to 5%. What is the percentage change in the price of each bond after the decline in interest rates? Fill in the following table. Do not round intermediate calculations. Round the monetary values to the nearest cent and percentage values to two decimal places. Enter your answers as positive values.
Price @ 8% | Price @ 5% | Percentage Change | |
10-year, 10% annual coupon | $ | $ | % |
10-year zero | |||
5-year zero | |||
30-year zero | |||
Perpetuity, $100 annual coupon |
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