Advanced Placement (AP), 18.10.2020 15:01 avi46

Tuvok bought corporate bonds with a face value of $1000 last year. At the time, he could have earned 5% interest if he had deposited money in a savings account at Vulcan Bank. All of a sudden, interest rates at Vulcan Bank increased to 8%. A. The price of the bonds is unaffected by the interest rate
B. The price of the bonds will remain $1000
C. The price of the bonds will become the price that makes the interest earned on both assets equal
D. The price of the bonds will decrease
E. The price of the bonds will increase

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Tuvok bought corporate bonds with a face value of $1000 last year. At the time, he could have earned...