Question $25(2\mathrm{.}5$ points$)$

Which of the following statemens is CORRECT$7$

A$)$ You hold two bonds, a $10-$year, aero cospon$,$ isuse and a $10-$year bond that pays a $6\%$ annual coupon. The mese market rate, $6\%,$ applies to boch bools. If the market rate rises from its current level, the zero cospon bond will experiface the larger percemage decline.

B$)$ The time to maturicy does nor aftert the chasge in the value of a boed in response to a given change is interest rates.

C$)$ Yo$.$ hold rwo book. One is a $10-$year, new coupon, bond and the other in a $10-$year bood ther pags a $6$$ ane usl coupon. The same marker rate, $6$K$,$ applies to bod bods. If the market rater flues from the curred level, the zero coupon bond will experiesce the maller perfertage declies.

D$)$ The shoent the sime to maturis, the greater the chinge in the value of a bond in response to a givera change in interest rater, other things held coestast.

E$)$ The longer the sime to maturig, the smaller the clarge in the value of a bond in eriponse to a givea change in linterest rates.