Andre owns a corporate bond with a coupon rate of 8% that matures in 10 years. Ruth owns a
corporate bond with a coupon rate of 12% that matures in 25 years. If interest rates go down, then
A) the value of both bonds will increase.
B) the value of both bonds will remain the same because they were both purchased in an earlier
time period before the interest rate changed.
C) the value of Ruth's bond will decrease more than the value of Andre's bond due to the longer
time to maturity.
D) the value of Andre's bond will decrease and the value of Ruth's bond will increase.
A
You might also like to view...
Judgment-proof means that the creditor:
A) Will likely be able to collect. B) Has won many lawsuits. C) May not collect. D) Is a good litigator.
To ensure that the receiver effectively receives the message you should:
A. use generic messages so they are widely understood B. use messages that are tailored to the receiver C. use simple words D. all of the above