A $1000 Bond with a Coupon Rate of 6

question 48

Multiple Choice

A $1000 bond with a coupon rate of 6.2% paid semiannually has eight years to maturity and a yield to maturity of 8.3%. If interest rates rise and the yield to maturity increases to 8.6%, what will happen to the price of the bond?

• A) The price of the bond will fall by $18.93.
• B) The price of the bond will fall by $15.78.
• C) The price of the bond will rise by $15.78.
• D) The price of the bond will not change.

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Definitions:

Competing Style

A conflict resolution approach where one puts their own interests above everyone else's to win.

Assertiveness

Involves expressing one's thoughts, feelings, and beliefs in a direct, honest, and appropriate way that respects the rights of others.

Cooperative Responses

Reactions or behaviors that involve working together towards a common goal or solving a problem collectively.

Managing Conflict

The process of identifying and addressing differences that have the potential to disrupt harmony and productivity in an organization or relationship.