The relationship between a bond's price and the yield to maturity
A) changes at a rate equal to the change in yield.
B) is linear.
C) is inverse.
D) is relative.

Name: The relationship between a bond's price and the yield to maturity A) changes at a rate equal to the change in yield. B) is linear. C) is inverse. D) is relative.
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Question

Quizplus · Accepted Answer

The relationship between a bond's price and its yield to maturity is inverse. When the yield to maturity (interest rates) rises, bond prices fall, and vice versa.

The Relationship Between a Bond's Price and the Yield to Maturity