xam Continued on the next page.. Bond Duration and Volatility (15 points possible). A) Calculate the duration and volatility of Security A and Security B. The cash flows for . total of Security A pays $160, while the cash flows for Security four years. The going interest rte for both securities is 12%. B pays $300, each period for a B) What is the difference in duration between both securities A and B? How would the price of each respond to a 1% change in Yield to Maturity? How sensitive is Security A vs. B to changes in the Interest Rate? What is the purpose of, or why do we calculate duration and volatility ofbonds? In your own brief words please