Say you think interest rates on $10-$year bonds will decline by $2\%.$ You have $$1$ million and there are two bonds you can buy: A B Coupon $10\%3\%$ Years to Maturity $1010$ Yield to Maturity $7\%7\%$ Price $$1210\mathrm{.}71$ $$719\mathrm{.}06$ Payment annual annual Assume you can buy fractions of a bond, so you can either put the whole million in bond A or B$.$ Which do you buy, and what will be your profit if interest rates decline by $2\%$ as you expect?$($Chapter $6)$ Say you think interest rates on $10-$year bonds will decline by

$2\%.$ You have $$1$ million and there are two bonds you can buy:

Assume you can buy fractions of a bond, so you can either put the whole

million in bond A or B$.$ Which do you buy, and what will be your profit

if interest rates decline by $2\%$ as you expect?