a. Explain which of the following bonds has higher interest rate
sensitivity. Bond A is a 15-year, noncallable bond with a coupon
rate of 7%, selling at par.
Bond B is a 15-year, callable bond with a coupon rate of 9%,
also selling at par.
b. Tony, a fixed-income portfolio manager, is managing a
portfolio of $10 million. His target duration is 7 years, and he
can choose from two bonds: a zero-coupon bond with maturity of 3
years, and...