Bond J has a coupon rate of 4 percent and Bond K has a coupon rate of
Question:
Bond J has a coupon rate of 4 percent and Bond K has a coupon rate of 10 percent. Both bonds have 12 years to maturity, make semiannual payments, and have a YTM of 7 percent.
If interest rates suddenly rise by 2 percent, what is the percentage price change of these bonds?(Negative amounts should be indicated by a minus sign.Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)
Percentage change in price of Bond J%Percentage change in price of Bond K%
What if rates suddenly fall by 2 percent instead?(Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)
Percentage change in price of Bond J%Percentage change in price of Bond K%