Question: 12. Halmark has two bonds outstanding, A and B. Both bonds have a par value of $1,000, and a coupon rate of 1%. Bond A

12. Halmark has two bonds outstanding, A and B. Both bonds have a par value of $1,000, and a coupon rate of 1%. Bond A has a remaining life of 1 vear and Bond B has a life of 10 years. If the rate of interest on similar bonds were to rise, which of the following would happen: A. The value of Bond A will rise but the value of Bond B will fall B. The value of Bond B will rise but the value of Bond A will fall. C. Both bonds will sell for their par value D. The value of Bond B will fall more than the value of Bond A. E. None of the above

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