Answer to Question #70764 in Macroeconomics for Ashkar Muhammad

Question #70764
Why do bond prices fall when interest rate rise?
1
Expert's answer
2017-11-07T09:44:06-0500
As market interest rates change, a bond's coupon rate—which, remember, is fixed—becomes more or less attractive to investors, who are therefore willing to pay more or less for the bond itself. That is why bond prices fall when interest rate rise.

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