Question: Q#4 ) A 10-year bond is issued with a face value of $1,000, paying interest of $60 a year. If market yields increase shortly after

Q#4) A 10-year bond is issued with a face value of $1,000, paying interest of $60 a year. If market yields increase shortly after the T-bond is issued, what happens to the bond's:

a) Coupon rate?

b) Price?

c) Yield to maturity?

d) What do you know about the Law of One Price (LOOP) in the context of term structure of interest rates?

Q#4) A 10-year bond is issued with a face value of $1,000, paying interest of $60 a year. If market yields increase shortly after the T-bond is issued, what happens to the bond's:

a) Coupon rate?

b) Price?

c) Yield to maturity?

d) What do you know about the Law of One Price (LOOP) in the context of term structure of interest rates?

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