Exhibit 18.1 USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)

question 16

Multiple Choice

Exhibit 18.1
USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)
A $1000 par value bond with 5 years to maturity and a 6% coupon has a yield to maturity of 8%. Interest is paid semiannually.
-Refer to Exhibit 18.1. Estimate the percentage price change for this 5-year $1,000 par value bond, with a 6% coupon, if the yield rises from 8% to 8.5%. Interest is paid semiannually.

• A)2.1%
• B)-2.1%
• C)4.4%
• D)-4.4%
• E)None of the above

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Definitions:

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