MLK Bank has an asset portfolio that consists of $$100$ million of $30-$year; $10$ percent annual coupon, $$1,000$ bonds that sell at par.

a$-1.$ What will be the bonds' new prices if market yields change immediately by $+-010$ percent?

a$-2.$ What will be the new prices if market yields change immediately by $+-2\mathrm{.}00$ percent?

b$-1.$ The duration of these bonds is $10\mathrm{.}3696$ years. What are the predicted bond prices in each of the four cases using the duration

rule?

b$-2.$ What is the amount of error between the duration prediction and the actual market values?

Complete this question by entering your answers in the tabs below.

Required BI

Required B$2$:

What is the amount of error between the duration prediction and the actual market values? $($Do not round intermediate

calculations. Enter all answers as positive numbers. Round vour answers to $2$ decimal places. $($e$.$Q$.,32\mathrm{.}16))$