price go up when interest rates fall? Why does the price go down when interest rates rise? (Round to the nearest cent.) If the interest rate falls to 3%, what should this bond sell for in the market? (Round to the nearest cent.) If the interest rate rises to 5%, what should this bond sell for in the market? (Round to the nearest cent.) Why does the price go up when interest rates fall and down when interest rates rise? (Select the best response.) B. When the interest rate becomes larger (smaller), the future value of each payment becomes smaller (larger) and the total present value of the perpetuity decreases (increases). c. When the interest rate becomes larger (smaller), the payment at the end of each period becomes smaller (larger) and the total present value of the perpetuity decreases (increases)