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Business, 19.02.2020 03:27 angelteddy033

Consider three bonds with 8% coupon rates, all making annual coupon payments and all selling at a face value of $1,000. The short-term bond has a maturity of 4 years, the intermediate-term bond has maturity 8 years, and the long-term bond has maturity 30 years.
a. What will be the price of the 4-year bond if its yield increases to 9%?
b. What will be the price of the 8-year bond if its yield increases to 9%?
c. What will be the price of the 30-year bond if its yield increases to 9%?
d. What will be the price of the 4-year bond if its yield decreases to 7%?
e. What will be the price of the 8-year bond if its yield decreases to 7%?
f. What will be the price of the 30-year bond if its yield decreases to 7%?

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