Use the table for the question(s)below. Consider the following four bonds that pay annual coupons: -The percentage change in the price of the bond "C" if its yield to maturity increases from 9% (Price₀)to 10% (Price₁)is closest to: A)-17%. B)-6%. C)-4%. D)4%.

Question

Quizplus · Accepted Answer

When the yield to maturity increases, the price of the bond decreases. The percentage change in price is calculated using the bond price formula, and a 1% increase in yield typically results in a price decrease of around 6% for bonds with long durations.

Use the Table for the Question(s)below