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QUESTION 14 Price risk is the risk that O 1. the bond principal will not be paid in full or on time O 2. the

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QUESTION 14 Price risk is the risk that O 1. the bond principal will not be paid in full or on time O 2. the bonds in a dedicated portfolio will decrease in value in response to an increase in interest rates O 3, market prices increase due to market interest rate changes making bonds more expensive to purchase O 4. the yield to maturity will be less than the inflation risk causing the real rate of return to be negative

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