Which of the Following Statements About Bonds Is True

question 87

Multiple Choice

Which of the following statements about bonds is true?

• A) If market interest rates are below a bond's coupon interest rate, then the bond will sell above its par value.
• B) Long-term bonds have less interest rate risk than do short-term bonds.
• C) Bond prices move in the same direction as market interest rates.
• D) As the maturity date of a bond approaches, the market value of a bond will become more volatile.

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