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Phil Owns a 7%, Semiannual Coupon Bond That Has a Face

Question 28

Multiple Choice

Phil owns a 7%, semiannual coupon bond that has a face value of $1,000 and matures in 16 years. The bond has a current yield to maturity of 7.1%. What will the percentage change in the price of his bond be if interest rates decrease by 50 basis points?


A) 4.33%
B) 4.68%
C) 4.91%
D) 5.17%
E) 5.26%

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