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Suppose you have two bonds which pay annual interest, have 6 percent coupons, and currently have 6 percent yields to maturity. However, Bond A has 5 years to maturity and Bond B has 10 years to maturity. If the market rate of interest rises unexpectedly to 7 percent, the price of Bond A will decline by _____ percent and the price of Bond B will decline by _____ percent.

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92708571

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