xxx has two bonds issue outstanding , both paying the same annual interest of $55, called series A and series B. Series A has a maturity of 12 years, whereas Series B has a maturity of 1 year.

a. What would be the value of each of these bonds when the going interest rate is (1) 4percent, (2) 7 percent, and (3) 10 percent? assume there is only one more interest payment to be made on the series B bonds.

b. Why does the longer term (12 years) bond fluctuated more when the interest rate change than does the shorter term (1 year) bond?