Two bonds, one a 30-year bond and the other a 1-year bond, have the same interest rate. If the interest rate in the economy falls, the value of the:
A. long-term bond falls by more than the value of the short-term bond falls.
B. long-term bond rises by more than the value of the short-term bond rises.
C. short-term bond falls by more than the value of the long-term bond falls.
D. short-term bond rises by more than the value of the long-term bond rises.
Answer: B
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