Suppose that a pension fund manager is holding a ten-year 10% coupon bond in the fund's portfolio and the interest rate is currently 10%. What loss would the fund be exposed to if the interest rate rises to 12% next year provided that duration is 6.76 year? Now the pension manager has the option to hold a ten-year coupon bond with a coupon rate of 20% instead of 10%. The duration for this 20% coupon bond is 5.98 years when the interest rate is 10%. Find the approximate change in the bond price when the interest rate increases from 10% to 12%. Which bond the manager should hold and why?