Problem $8-18$ Interest Rate Risk

Bond Sam and Bond Dave both have $9$ percent coupon bonds outstanding, with

semiannual interest payments, and both are priced at par value. Bond Sam bond has five

years to maturity, whereas the Bond Dave bond has $18$ years to maturity.

If interest rates suddenly rise by $2$ percent, what is the percentage change in the price of

these bonds? $($A negative answer should be indicated by a minus sign. Do not round

intermediate calculations and enter your answers as a percent rounded to $2$ decimal

places, e$.$g$.,32\mathrm{.}16.)$

Answer is complete but not entirely correct.

If interest rates were to suddenly fall by $2$ percent instead, what would the percentage

change in the price of these bonds be then? $($Do not round intermediate calculations

and enter your answers as a percent rounded to $2$ decimal places, e$.$g$.,32\mathrm{.}16.)$

Answer is complete but not entirely correct.