If the market interest rate rises, _____.
A) the present value of future payments increases
B) the supply of bonds decreases
C) the market price for bonds decreases
D) the demand for bonds decreases

Question

Quizplus · Accepted Answer

When the market interest rate rises, the market price for bonds decreases because the fixed payments from existing bonds become less attractive compared to new bonds issued at the higher current interest rates.

If the Market Interest Rate Rises, _____