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28 Sep 2019
Both Bond Sam and Bond Dave have 9 percent coupons, make semiannual payments, and are priced at par value. Bond Sam has 3 years to maturity, wheareas Bond Dave has 14 years to maturity. If interest rates suddenly fall by 2 percent, the percentage change in the price of Bonds Sam and Dave is percent and percent, respectively.
Both Bond Sam and Bond Dave have 9 percent coupons, make semiannual payments, and are priced at par value. Bond Sam has 3 years to maturity, wheareas Bond Dave has 14 years to maturity. If interest rates suddenly fall by 2 percent, the percentage change in the price of Bonds Sam and Dave is percent and percent, respectively.
papayaprofessorLv10
12 Oct 2022
Bunny GreenfelderLv2
28 Sep 2019
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Related questions
Both Bond Bill and Bond Ted have 12 percent coupons, make semiannual payments, and are priced at par value. Bond Bill has 3 years to maturity, whereas Bond Ted has 20 years to maturity.
Requirement 1:
| If interest rates suddenly rise by 3 percent, what is the percentage change in the price of these bonds? (Do not round intermediate calculations. Negative amounts should be indicated by a minus sign. Round your answers to 2 decimal places (e.g., 32.16).) |
| Percentage change in price | |
| Bond Bill | % |
| Bond Ted | % |
| Requirement 2: |
| If rates were to suddenly fall by 3 percent instead, what would be the percentage change in the price of these bonds? (Do not round intermediate calculations. Round your answers to 2 decimal places (e.g., 32.16).) |
| Percentage change in price | |
| Bond Bill | % |
| Bond Ted | % |
