Jayce Arnold, a CFA candidate, is studying how the market yield environment affects bond prices. She considers a $1000 face value, option-free bond issued at par. Which of the following statements about the bond’s dollar price behavior is most likely accurate when yields rise and fall by 200 basis points, respectively Price will:（）
A. decrease by $124, price will increase by $149.
B. increase by $124, price will decrease by $149.
C. decrease by $149, price will increase by $124.
参考答案：A
解析：
As yields increase, bond prices fall, the price curve gets flatter, and changes in yield have a smaller effect on bond prices. As yields decrease, bond prices rise, the price curve gets steeper, and changes in yield have a larger effect on bond prices. Thus, the price increases when interest rates decline must be greater than the price decrease when interest rates rise (for the same basis point change). Remember that this applies to percentage changes as well.