Impact of Rising Interest Rates on Bond Prices

The bond market plays a critical role in the fixed income securities landscape, where various instruments are traded based on their risk and return profiles. Consider a scenario where a corporate bond is issued with a fixed coupon rate of 5% and it matures in 10 years. If interest rates in the market subsequently rise to 6%, how is the price of this bond likely to be affected?

Assuming that the bond is selling in a competitive market, think about how the interest rate changes influence the present value of future cash flows generated by the bond.