A $10,000 Bond with a Coupon Rate of 3

question 12

Multiple Choice

A $10,000 bond with a coupon rate of 3.1% paid semi-annually has 10 years to maturity and a yield to maturity of 4.8%.If interest rates rise and the yield to maturity increases to 5.8%,what will happen to the price of the bond?

• A)rise by $357.89
• B)rise by $126.75
• C)rise by $84.78
• D)fall by $444.34
• E)fall by $689.47

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Definitions:

Empowerment

Giving employees permission to make decisions and take action on their own to help customers.

Predictive Modeling

The process of using data mining and probability to forecast outcomes. Each model is made up of a number of predictors, which are variables that are likely to influence future results.

Customer Service Activities

Tasks or efforts undertaken by a company to ensure customer satisfaction and handle inquiries, complaints, or assistance requests effectively.

Human And Mechanical

Covers processes or tasks performed by humans and machines, highlighting the interaction or division of labor between human skills and mechanical automation.