A decrease in market interest rates forces the bondholder to accept a lower rate of return on the income received and therefore reinvested on the investment. Which of the following best describes this source of risk to the bondholder? Price risk Reinvestment risk Call risk Default risk A corporate bond has a par value of $1,000 and matures in 10 years. The coupon rate on this bond is 5%, paid annually and investors require a 5% annual return. The current yield (CY) and the capital gains yield (CGY), are closest to: CY - 10%; CGY = 0% CY-5%; CGY = 0% CY=096; CGY -5% CY-5%; CGY =5% You are managing a bond portfolio and expect interest rates to decline. What type of bonds are most desirable to keep in your portfolio in order to take advantage of the expected decline in YTM? short-term, high coupon long-term, high coupon short-term, low coupon long-term, low coupon ABC bond has a par value of $1000, 5.8% coupon, semi-annual pay. If the bond matures in 10 years and the nominal YTM IS 8%. compounded semiannually, the price of this bond today is closest to? $1.244 $851 $1,000 $783