# Interest rate risk and the time to maturity have a

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Interest rate risk and the time to maturity have a relationship that is best described as:inversedirectvarying
A zero-coupon bond pays no interest payments to the bondholder. It has a \$1,000 par value and matures in 5 years. What is the value of this bond if the market rate of interest on similar risk bonds is 10%?
\$1,000.00Credit risk, or default risk, is the risk that:
Cambridge State Bank is paying 7% interest on its one-year certificates of deposit. If the inflation rate is 4%, which of the following is the best approximation for the real rate of interest that Cambridge State Bank is paying?
What is the yield to maturity (YTM) for a \$1,000 par value bond selling for \$1,100 that matures in 5 years and pays a 10% coupon one time a year?7.5%10.0%
12.5%11.1%
What is the market price of a \$1,000 face value bond quotedat 97 ½%?
The present value of a bond’s __________ determines the valueof the bond.