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What would the percentage change in the price of bond sam

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Both Bond Sam and Bond Dave have 6 percent coupons, make semiannual payments, and are priced at par value. Bond Sam has 4 years to maturity, whereas Bond Dave has 14 years to maturity.

Question 1: If interest rates suddenly rise by 3 percent, what is the percentage change in the price of Bond Sam?

Question 2: If interest rates suddenly rise by 3 percent, what is the percentage change in the price of Bond Dave?

Question 3: If rates were to suddenly fall by 3 percent instead, what would the percentage change in the price of Bond Sam be then?

Question 4: If rates were to suddenly fall by 3 percent instead, what would the percentage change in the price of Bond Dave be then?

Reference no: EM132695495

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