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Jackson Central has a 6-year, 8% annual coupon bond with a $1,000 par value. Earls Enterprises has a 12-year, 5.89% annual coupon bond with a $1,000 par value. Both bonds currently have a yield to maturity of 6%. Which of the following statements are correct if the market yield increases to 7%?

a. Both bonds will decrease in value by 4.61%.

b. The Earls bond will increase in value by $88.65.

c. The Jackson bond will increase in value by 4.61%.

d. The Earls bond will decrease in value by 7.56%.

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