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What is the percentage change in the price of the bonds

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Reference no: EM132945265

The Tornado Corp. has a 6 percent coupon bond outstanding. The Waves Corp has a 12 percent bond outstanding. Both bonds have 9 years to maturity, make semiannual payments, and have a YTM of 9 percent.

Problem 1: If interest rates suddenly rise by 3 percent, what is the percentage change in the price of these bonds? What if interest rates suddenly fall by 3 percent instead?

Reference no: EM132945265

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