Question

The Walthers Company has a semi-annual coupon bond outstanding. An increase in the market rate of interest will have which one of the following effects on this bond?�?A.�increase the coupon rate?B.�decrease the coupon rate?C.�increase the market price?D.�decrease the market price?E.�increase the time period

Answer 1

D. decrease the market price

Step-by-step explanation:

An increase in the market rate of interest will decrease the market price of the bond.

Generally, in accounting an increase in market rate usually result in decrease in market price. The market rate is inversely proportional to market prices.