A corporate bond with a 7.550 percent coupon has fourteen years left to maturity. It has had a credit rating of BB and a yield to maturity of 9.8 percent. The firm has recently become more financially stable and the rating agency is upgrading the bonds to BBB. The new appropriate discount rate will be 8.7 percent
What will be the change in the bond’s price in dollars? (Assume interest payments are semiannual.) (Do not round intermediate calculations. Round your final answer to 2 decimal places.)
What will be the change in the percentage terms? (Do not round intermediate calculations. Round your final answer to 2 decimal places.)