Interest Rates Sensitivity:
An investor purchased the following 5 bonds. Each bond had a par value of $1,000.00 and an 8% yield to maturityon the purchase day.
Immediately after the investor purchased the bonds , interest rates fell, and each bond had a new YTM of 7%.
What is the percentage change in price for each bond after the decline in interest rates?
Fill in the following table:
10-YR, 10% annual coupon price, 8% price and 7% percentage change.
10-year zero
5-year zero
30 year zero
$100.00 Perpetuity
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