Consider a 6 percent coupon bond with twelve years to, Financial Management

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Consider a 6 percent coupon bond with twelve years to

Consider a 6 percent coupon bond with twelve years to maturity and a current price of $1,062.40. Suppose the yield on the bond suddenly increases by 2 percent.

a. Use duration to estimate the new price of the bond. (Do not round intermediate calculations. Round your answer to 2 decimal places. Omit the "$" sign in your response.)

Price $

b. Calculate the new bond price. (Do not round intermediate calculations. Round your answer to 2 decimal places. Omit the "$" sign in your response.)

Price $

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