The Beta Co.bonds have a maturity of 13 years,a face value of $1,000,a coupon rate of 6.5 percent,and pay interest annually.What is the percentage change in the price of these bonds if the market yield rises to 6.9 percent from its current level of 6.5 percent?

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At 6.5%,the bond sells at par.At 6.9%,the bond sells at a discount. Bond value = (0.065 × $1,000)× {[1 - 1 / (1 + 0.069)¹³] / 0.069} + [$1,000 / (1 + 0.069)¹³] = $966.38 11ea6c22_9304_45c9_9716_fd9a48735cd5_TB1200_00 Percentage change in price = ($966.38 - $1,000)/ $1,000 = -0.0336 or - 3.36%