The Total Return on a 5 Year Bond with $10000

question 85

Multiple Choice

The total return on a 5 year bond with $10000 par value and an annual coupon rate of 6 percent will be most favourable if interest rates

• A)increase to 8 percent.
• B)decrease to 4 percent.
• C)increase to 7 percent.
• D)decrease to 5 percent.

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