1: which of the following statements is true? a: the value of a bond is inversel

Question

1: which of the following statements is true?

a: the value of a bond is inversely related to changes in investors present required rate of return

b: if interest rates decrease, the value of a bond will decrease

c: if interest rates increase, the value of a bond increase

d: none of the above

2. for a given stated interested rate, an investor would recieve a greater future value with daily compounding as opposed to monthly compounding. true or false

3. one characteristic of an annutiy is that the payment amount is the same during each period. true or false

4. as market rates of interest rise, investors move their funds into bonds, thus increasing their price and lowing their yeild.

true or false

5. the totala amount of interest earned on a lump sum investment will exacty double if the amount of time is exactly doubled, everything else equal. true or false

Explanation / Answer

1 a: the value of a bond is inversely related to changes in investors present required rate of return

2. True

3. False

4. True

5. False

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