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? Select one: O a. The price of the bond will fall by $15.78. O b. The price of the bond will fall by $18.93. OC The price of the bond will not change. O d. The price of the bond will rise by $15.78.

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? Select one: O a. The price of the bond will fall by $15.78. O b. The price of the bond will fall by $18.93. OC The price of the bond will not change. O d. The price of the bond will rise by $15.78.

Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)

7th Edition

ISBN:9780357033609

Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Chapter12: Investing In Stocks And Bonds

Section: Chapter Questions

Problem 10FPE

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