The Faulk Corp. has a 6 percent coupon bond outstanding.

The Gonas Company has a 14 percent bond outstanding.

Both bonds have 12 years to maturity, make semiannual payments, and have a YTM of 10 percent.

If interest rates suddenly rise by 2 percent, what is the percentage change in the price of these bonds? What if interest rates suddenly fall by 2 percent instead? What does this problem tell you about the interest rate risk of lower coupon bonds?