what happens to the interest rate during the life of a 10 year bond that a person purchased paying 6%…

what happens to the interest rate during the life of a 10 year bond that a person purchased paying 6% interest?\nthe interest rate changes when the bond is sold to another investor.\nthe interest rate decreases each year.\nthe interest rate increases each year.\nthe interest rate remains the same for the life of the bond.

what happens to the interest rate during the life of a 10 year bond that a person purchased paying 6% interest?\nthe interest rate changes when the bond is sold to another investor.\nthe interest rate decreases each year.\nthe interest rate increases each year.\nthe interest rate remains the same for the life of the bond.

Answer

Brief Explanations:

Bonds typically have a fixed - interest rate, known as the coupon rate, which is set at the time of issuance. In this case, the 10 - year bond was issued with a 6% interest rate. This rate remains constant for the life of the bond, regardless of whether it is sold to another investor or not. Interest rate changes in the market do not affect the coupon rate of the bond once it is issued.

Answer:

The interest rate remains the same for the life of the bond.