schoolhelp7283 schoolhelp7283
  • 19-03-2021
  • Business
contestada

DLQ Inc. bonds mature in 12 years and have a coupon rate of 6 percent. If the market rate of interest increases, then the:

Respuesta :

Parrain
Parrain Parrain
  • 22-03-2021

Answer: d. Market price of the bond will decrease.

Explanation:

A key part of determining the price of a bond is determined by discounting the the coupon payments and the par value at the market rate of interest or the yield.

This is why the interest and the market price are inversely related because an increase in the interest rates means that discounting would be heavier thereby leading to a lower price. The market rate in this case will therefore decrease.

Answer Link

Otras preguntas

The torah is the holy book for what religion
what happens to a sun-like star after it has used up all the fuel in its core
on saturday emily made 10 times as much as monday.How much money did emily collect on monday?
The law of war is part of an international law that regulates the conduct of armed hostilities. Select all of the statements below that pertain to the law of wa
If a sample of 0.150 g of kcn is treated with an excess of hcl, calculate the amount of hcn formed in grams.
mr, torres took his students to the dolphin show, each row in the stadium had 11 seats, one adult sat at each of a row, and each group of 4 students was seated
how can you tell from the scale factor whether the original figure was enlarged or reduced?
A = P (8+sd) solve for d
why is it important to forgeve someone kjv
Benjamin britten's the young person's guide to the orchestra is a work based on a dance tune by which composer?