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Bond J has a coupon of 4.2 percent. Bond K has a coupon of 8.2 percent....

Bond J has a coupon of 4.2 percent. Bond K has a coupon of 8.2 percent. Both bonds have 10 years to maturity and have a YTM of 6 percent.

a. If interest rates suddenly rise by 1 percent, what is the percentage price change of these bonds?

Bond J:

Bond K:

b. If interest rates suddenly fall by 1 percent, what is the percentage price change of these bonds?

Bond J:

Bond K:

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jeff jeffy answered 1 year ago
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