A

$5,000

bond with a coupon rate of

5%

paid semiannually has

eight

years to maturity and a yield to maturity of

6.3%.

If interest rates fall and the yield to maturity decreases by 0.8%, what will happen to the price of the bond?

A.

rise by $243.54

B.

fall by $292.24

C.

fall by $243.54

D.

rise by 340.95