Which Answer Is FALSE Regarding Bond Prices and Interest Rates

question 81

Multiple Choice

Which answer is FALSE regarding bond prices and interest rates?

• A) Bond prices and interest rates move in opposite directions.
• B) The price of a bond is the present value of the coupon payments and the face value.
• C) The prices of short-term bonds display greater price sensitivity to interest rate changes than do the prices of long-term bonds.
• D) Interest rate risk can be described as the risk that changes in market interest rates will cause fluctuations in the bond's price.

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Definitions:

SATA Drive

A type of storage device connected via the Serial ATA interface, offering fast data transfer rates for computers.

Connectors

Devices used to join electrical terminations and create an electrical circuit, facilitating the connection and disconnection of electronic or electrical components.

Dynamic Disk

A Windows term for a volume that can be resized and managed without rebooting.

Basic Drive

Refers to a storage device not employing advanced storage features like RAID or dynamic disk extensions, typically formatted with a simple partition structure.