4. Problem 7.05 (Bond Valuation) eBook Problem Walk-Through An investor has two bonds in his portfolio that have a face value of $1,000 and pay a 10% annual coupon, Bond L. matures in 11 years, while Bond S matures in 1 yeat. What will the value of the Band be the going interest rate is on, 3%, and 1197 Assume that only one more interest payment is to be made on Bond Saties matur and that 11 more payments are to be made on Bond L. Round your answers to the nearest cent 8 114 Bond $ $ Bonds $ 1. Why does the longer-term bond's price vary more than the price of the shorter term bond when interest rates change? L. The change in due to a change in the required rate of return increases as a bond's maturity decreases 11. Long term bonds have greater interest rate risk than do short-term bonds. III. The change in price due to a change in the required rate of return decreases as a bond's maturity increases TV. Long-term bonds have lower interest rate risk than do short-term bonds long-term bonds have lower reinvestment rate risk than do short-term bonds Sev