The Amount That the Price of Bond "B" Will Change

question 7

Multiple Choice

The amount that the price of bond "B" will change if its yield to maturity increases from 7% to 8% is closest to:

• A)-$36
• B)$9
• C)$36
• D)$39

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Definitions:

Nonconforming Goods

Refers to products or goods delivered under a contract that fail to meet the specifications or standards agreed upon.

Acceptance

The act of agreeing to the terms of an offer, thus creating a binding contract between the parties.

Buyer

An individual or entity that purchases goods or services from a seller for money or other agreed consideration.

Liquidated Damages

Damages specified as a term of the contract before a breach of contract occurs.