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1) Calculate and discuss the price and difference between the following two bonds: NOTE: Pick your own rate and compare.

A) Bond A has a coupon rate of 9.5% and maturity of 12 years and Bond B has a coupon rate of 6% and maturity of 15 years.

B)Using duration what are the prices of the two bonds when interest rates increase by 200 basis points. By a 75-basis point increase? Why?

Please show all calculations

Financial Management, Finance

  • Category:- Financial Management
  • Reference No.:- M92260128

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