Last Year,Theo Purchased a Fixed-Rate,7-Year Bond at Par That Has

Multiple Choice

Last year,Theo purchased a fixed-rate,7-year bond at par that has a coupon rate of 6.5 percent.If the current market rate for this type and quality of bond is 6.8 percent,then he should expect

A) his interest payments to increase.
B) the bond's yield to maturity to remain constant.
C) the current yield today to be less than 6.5 percent.
D) the bond's current market price to exceed its face value.
E) to realize a capital loss if he sold the bond at today's market price.