The riskier the bond, the the discount rate_______ and the _______the price of the bond.
A)lower; lower
B)lower; higher
C)higher; lower
D)higher; higher

Name: The riskier the bond, the the discount rate_______ and the _______the price of the bond. A)lower; lower B)lower; higher C)higher; lower D)higher; higher
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Question

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A higher risk means investors require a higher rate of return or discount rate to compensate for the risk. This higher discount rate results in a lower bond price.

The Riskier the Bond, the The Discount Rate_______ and the _______The

The Riskier the Bond, the The Discount Rate_ and the _The