Question: plz solve now Part II. Problem Solving Questions (Please Show All Your Work) (70 pts)] Problem I (22 points) Bond A is a 15 -year,
Part II. Problem Solving Questions (Please Show All Your Work) (70 pts)] Problem I (22 points) Bond A is a 15 -year, $1,000 face value bond that pays semiannual coupon payments of $40. It was issued 3 years ago. If the annual required rate of return on similar bonds with similar a) Compute the current price for this bond. (4points) b) Compute the annual coupon rate. ( 3.5 Points) c) Compute the current yield. ( 3.5 points) d) If the interest rate goes up by 2% compute the price of bond A (4points) e) Calculate the percentage % change in price (3points) f) Bond B is a 15 year bond, $1,000 face value bond and pays semiannual coupon payments of $50. Bond B was also issued 3 years ago. If the prevailing annual required rate of return (i.e. 10% ) increases by 2%, which of bond A or B would have the largest percentage change in price Explain without showing calculations. (4 points)
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