IIA
IIA-CFSA · Question #184
IIA-CFSA Question #184: Real Exam Question with Answer & Explanation
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Question
As interest rate change, the price of an issued bond also changes. The change in price has an inverse relationship to changes in interest rates (if one rises, the other falls). If new bond issues are paying a higher interest rate than existing bonds, investors will not purchase existing bonds unless:
Options
- AThe bond is discounted
- BThe new bond prices fall
- CThe new issue is finished
- DThe interest rate declines
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