We also looked at expected returns. Why do bond values go down when interest rates go up?

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We also looked at expected returns. Why do bond values go down when interest rates go up? Is this true in the opposite direction?

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Investments

ISBN: 9780073530703

9th Edition

Authors: Zvi Bodie, Alex Kane, Alan J. Marcus

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Question Posted: Sep 19, 2013 05:23 AM

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Why do bond prices go down when interest rates go up? Dont lenders like high interest rates?
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We also looked at expected returns. Why do bond values go down when interest rates go up?

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Bond values go down when interest rates go up because the principal payments and fixed interest stat...View the full answer

Investments

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