Market Interest Rates Have Risen Substantially in the Five Years

Multiple Choice

Market interest rates have risen substantially in the five years since an investor purchased Treasury bonds that were offering a 7 percent return.If the investor sells now she is likely to receive:

A) greater than a 7 percent total return.
B) less than a 7 percent total return.
C) a 7 percent total rate of return.
D) a 7 percent nominal return but less than a 7 percent real return.