Which of the Following Statements Is True

question 31

Multiple Choice

Which of the following statements is true?

• A) A rise in interest rates causes bond prices to fall.
• B) Bond prices and interest rates are not connected.
• C) A fall in bond prices causes interest rates to fall.
• D) A fall in interest rates causes a fall in bond prices.

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Definitions:

Declaration of Solvency

A formal statement made by the directors of a company declaring that the company can meet its debts as they fall due.

Members' Voluntary Winding Up

is a process initiated by the shareholders of a solvent company to voluntarily dissolve the entity and distribute its assets.

Insolvent Company

A company that cannot pay its debts as they come due or has liabilities exceeding its assets.

External Auditor

A professional firm or individual outside of an organization hired to examine its financial records and attest to the accuracy of its financial statements.