An investor who expects declining interest rates would maximize their capital gain by purchasing a bond that has a ___ coupon and a ___ term to maturity.

Respuesta :

Answer: zero; long

Explanation:

An investor who expects declining interest rates would maximize their capital gain by purchasing a bond that has a zero coupon and a long term to maturity.

In this case, a zero-coupon bond will b chosen since the face value will have to be repaid when the bond matures.