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P7-19 Interest Rate Risk (LO2] Both Bond Sam and Bond Dave have 7 percent coupons, make semiannual payments, and are priced at par value. Bond

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P7-19 Interest Rate Risk (LO2] Both Bond Sam and Bond Dave have 7 percent coupons, make semiannual payments, and are priced at par value. Bond Sam has 5 years to maturity, whereas Bond Dave has 12 years to maturity. If interest rates suddenly rise by 2 percent, what is the percentage change in the price of Bond Sam? 0 -7.89% -7.91% -8.59% 8.05% If interest rates suddenly rise by 2 percent, what is the percentage change in the price of Bond Dave? -14.48% 0 -16.95% -14.50% 15.17% If rates were to suddenly fall by percent instead, what would the percentage change in the price of Bond Sam be then? 8.73% 8.75% 8.05% O -7.86% If rates were to suddenly fall by 2 percent instead, what would the percentage change in the price of Bond Dave be then? O 17.88% 17.86% -14.45% O 15.17%

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