Question: For fixed-rate bonds it's important to realize that the value of the bond has a(n) (-Select-1.constant2.inverse3.parallel) relationship to the level of interest rates. If interest

For fixed-rate bonds it's important to realize that the value of the bond has a(n)(-Select-1.constant2.inverse3.parallel) relationship to the level of interest rates. If interest rates rise, then the value of the bond (-Select-1.falls2.rises3.stabilizes); however, if interest rates fall, then the value of the bond (-Select-1.falls2.rises3.stabilizes). A (-Select-1.par2.discount3.premium)bond is one that sells below its par value. This situation occurs whenever the going rate of interest is above the coupon rate. Over time its value will (-Select-1.increase2.decrease3.flatten)approaching its maturity value at maturity. A(-Select-1.par2.discount3.premium)bond is one that sells above its par value. This situation occurs whenever the going rate of interest is below the coupon rate. Over time its value will(-Select-1.increase2.decrease3.flatten)approaching its maturity value at maturity. A par value bond is one that sells at par; the bond's coupon rate is equal to the going rate of interest. Normally, the coupon rate is set at the going market rate the day a bond is issued so it sells at par initially.

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