If Interest Rates Consistently Decline Over a Specific Period, the Market

question 35

Multiple Choice

If interest rates consistently decline over a specific period, the market price of a bond you own would likely ____ over this period. (Assume no major change in the bond's default risk.)

• A) consistently increase
• B) consistently decrease
• C) remain unchanged
• D) change in a direction that cannot be determined with the above information

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