Which statement regarding bond prices is false?
A)If interest rates rise,bond prices will fall.
B)All bond prices respond to changes in interest rates in the opposite direction,but they do not all respond to the same extent.
C)Bond prices and interest rates are negatively correlated.
D)If bond prices rise,interest rates will fall.

Question

Quizplus · Accepted Answer

This statement is false because if bond prices rise, it would mean that the demand for bonds has increased, which would result in a decrease in the bond yield (interest rate). Therefore, if bond prices rise, interest rates will fall.

Which Statement Regarding Bond Prices Is False