A 30-Year Zero Coupon Bond with a Face Value of $5,000

Multiple Choice

A 30-year zero coupon bond with a face value of $5,000 is currently selling for $1,156.88 and has a market rate of interest of 5%. Using the bond's modified duration, what is the approximate change in the price of the bond if interest rates fall to 4.25%?

A) Increase of $285.70
B) Increase of $247.90
C) Decrease of $285.70
D) Decrease of $247.90
E) Not enough information is given to answer the question.