Three-year government bonds are issued with a principal amount of $1,000 and an annual coupon rate of 7%. Thus, the owner will receive three coupon payments at the end of each year. one year prior to the maturation date of these bonds, a newspaper heading reads, "Bad Economic News Causes Prices of Bonds to Plunge," and the story reveals that these three- year bonds have fallen in price to $960. What has happened to prevailing interest rates?