Question: Problem 10.17 Interest Rate Risk (LO3, CFA4) Both Bond A and Bond B have 6.6 percent coupons and are priced at par value. Bond A

 Problem 10.17 Interest Rate Risk (LO3, CFA4) Both Bond A and

Problem 10.17 Interest Rate Risk (LO3, CFA4) Both Bond A and Bond B have 6.6 percent coupons and are priced at par value. Bond A has 8 years to moturity, while Bond 8 has 15 years to maturity. A. It interest rotes suddenly rise by 1.2 percent, what is the percentage change in price of Bond A and Bond B? (A negative value should be indicated by a minus sign. Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal pieces.) b. If interest rates suddenly fall by 12 percent instead, what would be the percentage change in price of Bond A and Bond B? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.)

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