After a Bond Issue If the Yield to Maturity Increases

question 20

Multiple Choice

After a bond issue if the yield to maturity increases a conventional bond will see the price:

• A)increase.
• B)decrease.
• C)stay the same.
• D)Not enough information to answer this question.

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Definitions:

Fixed Exchange-rate System

A currency value regime where a country's currency is pegged at a set value to another currency, a basket of currencies, or a commodity like gold.

Foreign Exchange Market

A global decentralized or over-the-counter market for trading currencies, facilitating international trade and investment.

Peg

Fixing the exchange rate of a currency by linking it to another currency or basket of currencies.

Fixed Exchange Rates

A currency system where the value of a country's currency is pegged to another currency, a basket of currencies, or a commodity like gold, minimizing fluctuations in exchange rates.