Question: Two bonds A and B have the same credit rating, the same par value and the same coupon rate. Bond A has 30 years to

Two bonds A and B have the same credit rating, the same par value and the same coupon rate.

Bond A has 30 years to maturity and bond B has 5 years to maturity.

Discuss which bond will trade at a higher price in the market

Discuss what happens to the market price of each bond if the interest rates in the economy go up. Which bond would have a higher percentage price change if interest rates go up?

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