Which of the Following Statements Is FALSE

question 26

Multiple Choice

Which of the following statements is FALSE?

• A)Bond prices converge to the bond's face value due to the time effect,but simultaneously move up and down due to unpredictable changes in bond yields.
• B)As interest rates and bond yields fall,bond prices will rise.
• C)Bonds with higher coupon rates are more sensitive to interest rate changes.
• D)Shorter maturity zero-coupon bonds are less sensitive to changes in interest rates than are longer-term zero-coupon bonds.

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