Question: If interest rates rise, bond prices will fall. Given the following pairs of bonds, indicate which bonds price will experience the greater price decline. a)

If interest rates rise, bond prices will fall. Given the following pairs of bonds, indicate which bond’s price will experience the greater price decline.

a) Bond A Coupon: 10%

Maturity: 5 years

Bond B Coupon: 6%

Maturity: 5 years

b) Bond A Coupon: 10%

Maturity: 7 years

Bond B Coupon: 10%

Maturity: 15 years

c) Bond A Coupon: 10%

Maturity: 5 years

Bond B Coupon: 6%

Maturity: 8 years

d) Bond A Coupon: 10%

Maturity: 1 year

Bond B Coupon: zero percent

Maturity: 10 years

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