Interest Rate Risk Interest rate risk is composed of price risk and reinvestment risk. If interest rates increase the investor's bond sale price is ________. If interest rates increase the investor's reinvestment income is ________. If an investor picks a bond with duration ____ the investment horizon the two risks are exactly offsetting.

a. decreased; increased; equal to b. increased; decreased; greater than c. increased; decreased; equal to d. decreased; increased; less than