As interest rates move up or down and the longer is a bond's term:

Name: As interest rates move up or down and the longer is a bond's term:
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Question

Quizplus · Accepted Answer

When interest rates move up or down, the bond's price moves in the opposite direction. This is known as interest rate risk. Moreover, the longer the bond's term, the more sensitive it is to changes in interest rates, which means that the more drastic is the movement of the bond's price in the opposite direction. Therefore, the correct answer is C.

As Interest Rates Move Up or Down and the Longer