Among all the given statements, the one that is correct or true is “During an economic contraction, bond prices are likely to rise.” Hence, Option D is correct.
<h3>What is bond?</h3>
There are many kinds of investments that are made by people just for security purposes. Those, investment bonds are also one of them. Bonds are investments that are informal security and are owned by investors.
Here, investors invest their money by lending it to a company for a particular period of time. They receive the regular interest payment in exchange for this investment, which is done by lending money.
Thus, Option D is correct.
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The complete question is attached in text form:
Which of the following statements is true?
1. The investment portfolio of younger investors should be heavily weighted toward conservative assets such as government bonds and blue chip stocks.
2. Bond prices and interest rates fluctuate directly.
3. The relationship between risk and potential reward is inverse.
4. During an economic contraction, bond prices are likely to rise.
