Bond J is a 4 percent coupon bond. Bond K is a 11 percent coupon bond. Both bonds have 7 years to maturity, make semiannual payments, and have a YTM of 9 percent. Requirement 1:
(a) If interest rates suddenly rise by 5 percent, what is the percentage price change of Bond J?
(b) If interest rates suddenly rise by 5 percent, what is the percentage price change of Bond K?