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Interest Rate Risk
The Faulk Corp. has a 6 percent coupon bond outstanding. The Gonas Company has a 14 percent bond outstanding. Both bonds have 12 years to maturity, make semiannual payments, and have a YTM of 10 percent.
If interest rates suddenly rise by 2 percent, what is the percentage change in the price of these bonds?
What if interest rates suddenly fall by 2 percent instead?
What does this problem tell you about the interest rate risk of lower coupon bonds?
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please show formulas.a balance sheet shows a total of noncallable 45 million. long-termdebt with a coupon rate of 7.00
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A bond with a settlement date of April 30, 2013 and a maturity date of May 15, 2021 has a coupon rate of 6.7%. (bond equivalent yield, semiannual compounding), If the yield to maturity of the bond is 6.33%, what is the list price of the bond on the s..
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