Which of the Following Statements Is False

question 37

Multiple Choice

Which of the following statements is false?

• A)When the prevailing market interest rate is higher than the coupon rate,the bond will be traded at a discount.
• B)When the prevailing market interest rate is lower than the coupon rate,the bond will be traded at a premium.
• C)The higher the coupon rate,the less sensitive the market price of the bond becomes to changes in prevailing market rates.
• D)The longer the time to maturity,the less sensitive the market price of the bond becomes to changes in prevailing market rates.

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Definitions:

Solvent Interaction

The process by which a solvent can dissolve solute particles, involving physical and chemical interactions.

Electronegativity

A measure of an atom's ability to attract electrons towards itself in a chemical bond.

Periodic Table

A tabular arrangement of the chemical elements, organized by their atomic number, electron configuration, and recurring chemical properties.

Noble Gases

A group of inert gases including helium, neon, argon, krypton, xenon, and radon, known for their lack of chemical reactivity.