Question: 1. (TCO 4) What effect, if any, will a decrease in interest rates have on bond values? (Points : 4) Bond values will increase. Bond

1. (TCO 4) What effect, if any, will a decrease in interest rates have on bond values? (Points : 4) Bond values will increase. Bond values will decrease. Bond values may increase or decrease, depending on the maturity, quality, and coupon rate. None of the above 2. (TCO 4) Duration is affected primarily by (Points : 4) the maturity of the bond. the market rate of interest. the coupon rate. All of the above

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