A bond pays a 8 percent coupon rate with 10 years to, Financial Management

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A bond pays a 8 percent coupon rate with 10 years to

A Bond pays a 8 percent coupon rate with 10 years to maturity, makes semiannual payments, and has a yield-to-maturity of 6 percent. If market interest rates suddenly rise 1 percent, what will be the percentage change in the price of the bond? Did it increase or decrease? Show your work for the current price, the new price, and the percentage change. Did the price increase or decrease if the market rate rises? Briefly explain why.

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