Question: Problem 9 - 1 7 ( Algo ) Required: a . Suppose Baa - rated bonds currently yield ( 7 . 0 %

Problem 9-17(Algo)
Required:
a. Suppose Baa-rated bonds currently yield \(7.0\%\), while Aa-rated bonds yield \(5.0\%\). Now suppose that due to an increase in the expected inflation rate, the yields on both bonds increase by \(1.2\%\). What would happen to the confidence index? (Round your answer: to 4 decimal places.)
Problem 9 - 1 7 ( Algo ) Required: a . Suppose

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