Explain the relationship between changes in interest rates and bond prices.

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Basic Finance An Introduction to Financial Institutions, Investments and Management

ISBN: 978-1285425795

11th Edition

Authors: Herbert B. Mayo

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Question Posted: Feb 21, 2020 04:33 AM

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Explain the relationship between changes in interest rates and bond prices.

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Bonds have an inverse relationship to interest rates When the cost of borrowing money rises when interest rates rise bond prices usually fall and viceversa Bonds have an inverse relationship to intere...View the full answer

Basic Finance An Introduction to Financial Institutions, Investments and Management

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