A sharp increase in interest rates will decrease the price of bonds and increase the interest income available to new bondholders. This will increase the demand for bonds compared to the demand for stocks, all other considerations remaining constant.
A. True
B. False
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Home » Business » A sharp increase in interest rates will decrease the price of bonds and increase the interest income available to new bondholders. This will increase the demand for bonds compared to the demand for stocks, all other considerations remaining constant.