Bond J is a 3.9% coupon bond. Bond K is a 9.9% coupon bond. Both bonds have 15 years to maturity, make semiannual payments and have a YTM of 6.9% (Do not round intermediate calculations. Negative answers should be indicated by a minus sign. Round the final answers to 2 decimal places.) If interest rates suddenly rise by 2%, what is the percentage price change of these hands? Percentage change in price of Bond % Percentage change in price of Bond K% What if rates suddenly fall by 2% instead? Percentage change in price of Bond J% Percentage change in price of Bond K%

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Bond Valuation

Bond valuation are the notes issued by the corporation to raise long-term funds for the business. The corporations are required to pay the interest on such liabilities at a specified rate of interest (termed as coupon rate) at specified dates which may be on semi-annual or annual basis. These interest payments may be in the form of coupons.