Bond Prices and Interest Rates Fill in the gaps in these typical quotations from articles from the Wall Street Journal.

a. “The benchmark 10-year Treasury bond rose more than 1/4 point to 106, a gain of more than $2.50 for a bond with a $1,000 face amount. Its yield, which moves in the

(same, opposite) direction from the price,

(rose, fell) to 6.65 percent

. . .”

b. “More investors and economists are beginning to believe that interest rates are headed higher, although many think long-term bond yields won’t move as fast as short-term rates. . . . Mr. Olsen . . .

believes there will be a significant sell-off in the bond market.”

Why would higher interest rates precipitate a significant sell-off in the bond market?