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2) When the price/interest rate relationship line for any option-free fix-coupon bond is graphed, it exhibits the shape shown below. Question: In which case

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2) When the price/interest rate relationship line for any option-free fix-coupon bond is graphed, it exhibits the shape shown below. Question: In which case is the price/interest rate relationship line parallel to the x-axes? Bond Price ($) 4,000 3,500 3,000 2,500- 2,000- 1,500 1,000 810.71 500 0- 5 S- 8 10 Interest Rate (%) 15 20 20 (5 min. 2 points)

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