Bond J has a coupon of 7.8 percent. Bond K has a coupon of 11.8 percent. Both bonds have 12 years to maturity and have a YTM of 8.7 percent. If interest rates suddenly rise by 2.4 percent, what is the percentage price change of these bonds?
Bond J has a coupon of 7.8 percent. Bond K has a coupon of 11.8 percent. Both bonds have 12 years to maturity and have a YTM of 8.7 percent. If interest rates suddenly rise by 2.4 percent, what is the percentage price change of these bonds?
Chapter6: Fixed-income Securities: Characteristics And Valuation
Section: Chapter Questions
Problem 8P
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