The market prices of existing bonds are

Name: The market prices of existing bonds are
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Question

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The market prices of existing bonds are inversely related to the interest rate. When interest rates rise, the value of existing bonds decreases and vice versa. This is because as interest rates rise, newer bonds are issued at higher interest rates, making older bonds with lower interest rates less attractive to investors, and therefore their value decreases.

The Market Prices of Existing Bonds Are