If overall interest rates in the economy raise, then a corporate bond with a fixed interest rate will decrease in value.

Name: If overall interest rates in the economy raise, then a corporate bond with a fixed interest rate will decrease in value.
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Question

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When overall interest rates in the economy raise, newly issued bonds typically offer a higher coupon rate to be competitive. Thus, the fixed interest rate on existing bonds becomes less attractive, causing their value to decrease.

If Overall Interest Rates in the Economy Raise, Then a Corporate