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● Statement 1 is correct: The twin factors that affect a bond's price are inflation and changing interest rates. A rise in either interest rates or the inflation rate will tend to cause bond prices to drop. Inflation and interest rates behave similarly to bond yields, moving in the opposite direction from bond prices. In short, inflation makes interest rates go up. This in turn makes bond values go down. Exception- A Bond with a fixed coupon rate will hold the same interest rate, no matter what happens in the market. ● Statement 2 is correct: Unlike stocks, the principal value of a bond is returned to the investor in full at maturity. This can make bonds attractive to risk-averse investors who are concerned about losing their capital. Although bonds are often viewed as a capital preservation tool, they also offer opportunities for capital appreciation.
The type of farming that reduces risk is known as______
What does the rhizosphere: soil (R:S) ratio quantify?
What is the top portion of the turned furrow slice called?
Which term describes uncoiling of buds in ferns?
How much Vitamin A should Fortified Milk contain?
Under which ministry does the Cotton Corporation of India (CCI) operate?
What is the percentage of nitrogen in the ammonium nitrate?
Which sub-scheme of Prampargat Krishi Vikas Yojna (PKVY) is associated with the promotion of natural farming?
National Agricultural Technology Project was started in the year:
Which of the following is a complex fertilizer?