Which of the Following Statements Is True of Bond Prices

question 51

Multiple Choice

Which of the following statements is true of bond prices?

• A) A fall in bond prices causes interest rates to fall.
• B) A fall in interest rates causes a fall in bond prices.
• C) A rise in interest rates causes bond prices to fall.
• D) Bond prices and interest rates are not connected.

---

Definitions:

Dividends Paid

The total amount of dividend payments issued to shareholders during a particular period.

Consolidation Worksheet

A tool used in preparing consolidated financial statements that combines the financials of a parent company and its subsidiaries.

Operating Income

Income generated from regular business operations, excluding non-operating income and expenses, interest, and taxes.

Initial Value Method

An accounting technique where investments are recorded at their original purchase cost, without subsequent adjustment for increases or decreases in value.