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You have two bonds with the following characteristics: Characteristics Coupon Bond A Bond B 4.0% 4.5% Yield to Maturity 3.44% 3.33% Years to Maturity

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You have two bonds with the following characteristics: Characteristics Coupon Bond A Bond B 4.0% 4.5% Yield to Maturity 3.44% 3.33% Years to Maturity 7 7 Par Value $1,000 $1,000 Price $845.00 $880.00 a. What are the bond durations? b. If rates rise to 5.55%, what are the new prices for each bond?

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