Term premium , QUESTION 7 A bond's rating provides a guide to its default risk. Long-term bonds rated AAA currently offer YTM of 7.5%. A-rated bonds sell at YTM of 8.2%. If a 20-year bond with a coupon rate of 7% has changed it's rating from AAA to A, what is the likely impact on the bond price? A. The bond price will rise because A-rating is a higher rating. B. The bond price will fall because A-rating is a higher rating. OC. The bond price will rise because A-rated bonds have a higher YTM than AAA-rated bonds. D. The bond price will fall because A-rated bonds have a higher YTM than AAA-rated bonds. O E. The bond price will not change. QUESTION Sav Click Save and Submit to save and submit. Click Save All Answers to save all answers. W