Which of the following appreciates most during a period of falling interest rates?
A) 7.2% coupon, 3 year maturity.
B) 7.4% coupon, 3-1/3 year maturity.
C) 7.6% coupon, 3-1/2 year maturity.
D) 7% coupon, 2-7/8 year maturity.
Answer: C) 7.6% coupon, 3-1/2 year maturity.