An Investor Purchased a Fixed-Coupon Bond at a Time When

question 75

Multiple Choice

An investor purchased a fixed-coupon bond at a time when the bond's yield to maturity was 6.9%.The investor sold the bond prior to maturity and realized a total return of 7.1%.Which of these most likely occurred while the investor owned the bond?

• A) The bond's current yield increased above the bond's coupon rate.
• B) The inflation rate increased.
• C) Market interest rates declined.
• D) Market interest rates increased.

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Definitions:

Psychotherapy

A form of treatment for emotional, psychological, and behavioral issues that involves talking with a mental health professional.

Conceptual Level

The degree of complexity, abstraction, and depth of thought that an individual can apply to understanding situations and solving problems.

Change Processes

Refers to the series of actions, operations, or mechanisms that lead to modifications or transformations within an individual, group, or system.

Intermediate

Positioned or occurring between two points, stages, or levels, often used to describe something not yet at an advanced stage.