Bond J has a coupon rate of 6 percent. Bond K has a coupon rate of...

Bond J has a coupon rate of 6 percent. Bond K has a coupon rate of 10 percent. Both bonds have 10 years to maturity, make semiannual payments, and have a YTM of 7 percent.

	If interest rates suddenly rise by 3 percent, what is the percentage price change of Bond J?

	-19.16% -19.18% -17.18% -18.18%

	If interest rates suddenly rise by 3 percent, what is the percentage price change of Bond K?

	32.91% -17.57% -15.57% -17.55%

	If interest rates suddenly fall by 3 percent, what is the percentage price change of Bond J?

	-24.92% 25.25% 25.23% -19.20%

	If interest rates suddenly fall by 3 percent, what is the percentage price change of Bond K?

	22.74% 22.86% 1.00% -17.59%

Solutions

Expert Solution

jeff jeffy answered 1 year ago

Next > < Previous

Related Solutions

Bond J has a coupon rate of 4 percent. Bond K has a coupon rate of...

Bond J has a coupon rate of 4 percent. Bond K has a coupon rate of 14 percent. Both bonds have 17 years to maturity, a par value of $1,000, and a YTM of 8 percent, and both make semiannual payments. a. If interest rates suddenly rise by 2 percent, what is the percentage change in the price of these bonds? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answers as...

Bond J has a coupon rate of 3 percent. Bond K has a coupon rate of...

Bond J has a coupon rate of 3 percent. Bond K has a coupon rate of 9 percent. Both bonds have 14 years to maturity, make semiannual payments, and have a YTM of 6 percent. If interest rates suddenly rise by 2 percent, what is the percentage price change of these bonds? 1.Percentage change in price of Bond _______ J% 2.Percentage change in price of Bond_______ K% What if rates suddenly fall by 2 percent instead? 3.Percentage change in price...

Bond J has a coupon rate of 5 percent. Bond K has a coupon rate of...

Bond J has a coupon rate of 5 percent. Bond K has a coupon rate of 9 percent. Both bonds have 9 years to maturity, make semiannual payments, and have a YTM of 7 percent. If interest rates suddenly rise by 4 percent, what is the percentage price change of Bond J? -23.65% -21.67% -22.67% -23.67% If interest rates suddenly rise by 4 percent, what is the percentage price change of Bond K? 31.98% -21.57% -19.59% -21.59% If interest rates...

Bond J has a coupon rate of 5.5 percent. Bond K has a coupon rate of...

Bond J has a coupon rate of 5.5 percent. Bond K has a coupon rate of 15.5 percent. Both bonds have eight years to maturity, a par value of $1,000, and a YTM of 12 percent, and both make semiannual payments. a. If interest rates suddenly rise by 3 percent, what is the percentage change in the price of these bonds? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answers...

Bond J has a coupon rate of 3 percent. Bond K has a coupon rate of...

Bond J has a coupon rate of 3 percent. Bond K has a coupon rate of 9 percent. Both bonds have 14 years to maturity, make semiannual payments, and have a YTM of 6 percent. If interest rates suddenly rise by 2 percent, what is the percentage price change of these bonds? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g.,...

Bond J has a coupon rate of 3 percent and Bond K has a coupon rate...

Bond J has a coupon rate of 3 percent and Bond K has a coupon rate of 9 percent. Both bonds have 16 years to maturity, make semiannual payments, and have a YTM of 6 percent. a. If interest rates suddenly rise by 2 percent, what is the percentage price change of these bonds? b. What if rates suddenly fall by 2 percent instead? a. Bond J- _____% Bond K - ______% b. Bond J- _____% Bond K- ______%

Bond J has a coupon rate of 5 percent. Bond K has a coupon rate of...

Bond J has a coupon rate of 5 percent. Bond K has a coupon rate of 10 percent. Both bonds have 9 years to maturity, make semiannual payments, and have a YTM of 6 percent. A. If interest rates suddenly rise by 3 percent, what is the percentage price change of Bond J? B. If interest rates suddenly rise by 3 percent, what is the percentage price change of Bond K? C. If interest rates suddenly fall by 3 percent,...

Bond J has a coupon rate of 7 percent and Bond K has a coupon rate...

Bond J has a coupon rate of 7 percent and Bond K has a coupon rate of 13 percent. Both have 12 years to maturity, both make semiannual payments, and both have a YTM of 10 percent. a.) If interest rates suddenly rise by 2 percent, what's the percentage price change of these bonds? b.) If rates suddenly fall by 2 percent instead? Fill in the table with answers. a.) Bond J ???? % a.) Bond K ???? % b.)...

Bond J has a coupon rate of 4.8 percent. Bond K has a coupon rate of...

Bond J has a coupon rate of 4.8 percent. Bond K has a coupon rate of 14.8 percent. Both bonds have eleven years to maturity, a par value of $1,000, and a YTM of 10.6 percent, and both make semiannual payments. a. If interest rates suddenly rise by 2 percent, what is the percentage change in the price of these bonds? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answers...

Bond J has a coupon rate of 5 percent. Bond K has a coupon rate of...

Bond J has a coupon rate of 5 percent. Bond K has a coupon rate of 10 percent. Both bonds have 7 years to maturity, make semiannual payments, and have a YTM of 8 percent. If interest rates suddenly rise by 5 percent, what is the percentage price change of Bond J? If interest rates suddenly rise by 5 percent, what is the percentage price change of Bond K? If interest rates suddenly fall by 5 percent, what is the...

Subjects