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 11 percent. Both bonds have 8 years to maturity, make semiannual payments, and have a YTM of 6 percent.

	If interest rates suddenly rise by 4 percent, what is the percentage price change of Bond J?

	-22.82% -21.82% -20.82% -22.80% 31.22%

	If interest rates suddenly rise by 4 percent, what is the percentage price change of Bond K?

	-19.77% -17.77% 39.84% -19.75% 26.52%

	If interest rates suddenly fall by 4 percent, what is the percentage price change of Bond J?

	31.20% -22.84% 31.18% -32.51%

	If interest rates suddenly fall by 4 percent, what is the percentage price change of Bond K?

	26.50% -19.79% 26.38% 6.42% -66.23%

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jeff jeffy answered 1 year ago

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