• Basavaraj Tonagatti
• 20 Feb, 2021

However, assume that suddenly RBI increased the interest rate. Assume that there are other options that are offering you higher returns than 8%. Hence, no one will buy such 8% yield bonds. In such a case, the price of this particular bond will fall. Hence, even though the face value remains the same i.e Rs.1,000, the price of the bond may fall. Assume it fallen to Rs.900.
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