Both Bond Sam and Bond Dave have 12 percent coupons, make semiannual payments, and are priced at $1,000.00. Bond Sam has 3 years to maturity, whereas Bond Dave has 20 years to maturity. Both bonds have a face value of $1,000. If interest rates suddenly rise by 3 percent, What is the percentage change in the price of these bonds? Note: A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. Percentage change in price Bond Sam % Bond Dave %

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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.