You Have Just Purchased a Government Bond for $1100 That

Multiple Choice

You have just purchased a government bond for $1100 that promises to pay $100 p.a.over the next five years.The market price of the bond has just increased to $1200.A likely reason for this is:

A) the face value of the bond has been increased.
B) the bond is perceived by the market to be more risky now than before.
C) interest rates,in general,have increased.
D) interest rates,in general,have decreased.