price sensitivity to underlying interest rate fluctuations for both Fidelity Music bond issues.

a$.$ What is the current price of both bonds?

b$.$ What will be the percentage change in bond price for both bonds if the underlying interest rates increase by $2\%?$ Which bond has more price sensitivity to interest rate risk?

d$.$ What conclusions do you draw from comparing your answers to parts $b$ and $c?$

e$.$ Would your answers to parts b through c change if both bonds matured in $13$ years and paid a $12\%$ annual couron and, if so$,$ how?

a$.$ The current price of the high yield bond is $ $($Round to the nearest cent.$)$

The current price of the investment grade bond is $$,($Round to the nearest cent.$)$

b$.$ The current price of the high yield bond if the underlying interest rate increases by $2\%$ is $ $($Round to the nearest cent.$)$

The percentage change in bond price for the high yield bond if the underlying interest rate increases by $2\%$ is $,\%.($Round to two decimal places.$)$

The current price of the investment grade bond if the underlying interest rate increases by $2\%$ is $$.($Round to the nearest cent.$)$

The percentage change in bond price for the investment grade bond if the underlying interest rate increases by $2\%$ is $\%.($Round to two decimal places.$)$ has more price sensitivity to interest rate risk because the percentage change in its price is after an increase in the interest rate. $($Select from the drop$-$down menus.$)$

c$.$ The current price of the high yield bond if the underlying interest rate decreases by $2\%$ is $$.($Round to the nearest cent.$)$

The percentage change in bond price for the high yield bond if the underlying interest rate decreases by $2\%$ is $\%.($Round to two decimal places.$)$