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content area Part 1 [Related to the Apply the Concept: Should You Invest in Junk Bonds?] An article on bloomberg.com discussing the office space sharing
content area Part 1 [Related to the Apply the Concept: "Should You Invest in Junk Bonds?"] An article on bloomberg.com discussing the office space sharing firm WeWork noted that "the yield on WeWork bonds soared above 10%." Can we tell from this statement whether the demand for WeWork bonds had increased or decreased? Part 2 A. No, the higher yield could be the result of either a decrease or an increase in bond demand. B. No, the only way yields can increase significantly is if bond supply decreased. C. Yes, demand must have decreased if a higher yield is required to attract buyers. D. Yes, demand must have increased if the yields were driven up to such high levels. Part 3 Can we tell from this statement whether the prices of WeWork bonds were increasing or decreasing? Part 4 A. No, there is no relationship between the price of a bond and its yield. B. Yes, a bond's price and its yield are negatively related so an increase in yield is an indication of a lower price on the bond. C. Yes, a bond's price and its yield are positively related so an increase in yield is an indication
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