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Because Bond Prices Are Sensitive to Changes in Interest Rates

Question 31

Multiple Choice

Because bond prices are sensitive to changes in interest rates:


A) bonds hardly ever sell in the secondary market at their face value.
B) bond prices are constantly changing.
C) interest rates in excess of the coupon rate cause the bond to sell at a discount, while interest rates below the coupon rate cause the bond to sell at a premium.
D) All of the above

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