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Bond J has a coupon rate of 5.1 percent. Bond S has a coupon rate of 15.1 percent. Both bonds have nine years to maturity, make semi annual payments, and have a YTM of 11.2 percent.

If interest rates suddenly rise by 3 percent, what is the percentage change in the price of these bonds?

If interest rates suddenly fall by 3 percent instead, what is the percentage change in the price of these bonds?

Financial Management, Finance

  • Category:- Financial Management
  • Reference No.:- M91537150

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