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Duration is a measure of
Question 13 options:
| True | |
| False |
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- which one is correct please confirm? QUESTION 27 The term structure of interest rates is related to the ____ risk premium. a. seniority b. marketability c. default d. maturityQuestion 13 (Mandatory) (1 point) Duration is a measure of bond price sensitivity to interest rate changes. True FalseInterest can be defined as the price of credit and also as a rate of return Question 21 options:True False
- which one is correct please confirm? QUESTION 38 The term structure of interest rates is the pattern of interest rate yields for securities that differ only in ____. a. the yield to maturity b. liquidity premiums c. the length of time to maturity d. default riskWhich of the following statements is/are most CORRECT? O 11 A yield curve depicts the relationship between bond's 'time to maturity and its yield to maturity. 2) A premium bond's price will decline over time if the required return remains unchanged. 3) A discount bond's price will decline over time if the required return remains unchanged. 4) Both a and b are correct.Stability deals with the relationship between debt and equity. Question 18 options: 1) True 2) False
- 4- How do you calculate the current value (price) of a bond? Explain through the formula and its description in your own words. How is the bond price affected by the change in interest rates and why?With regard to interest rate sensitivity measures and bonds: Group of answer choices C. Convexity attempts to capture the sensitivity of a bond’s duration to changes in interest rates. D. Both B & C B. Duration is related to yield approximation and convexity is related to price. A. Convexity is related to yield approximation and duration is related to priceQuestion 23 As bond maturity increases, the bond's risk: O A. B. C. D. E. Increases Decreases Does not change Sometimes increases and sometimes decreases Is inversely related to the value of the bond
- QUESTION 1 Under what conditions that a discount bond has a negative nominal interest rate? Is it possible for a coupon bond or perpetuity to have a negative nominal interest rate? a)If interest rates rise after a bond issue, what will happen to the bond’s price and YTM? Does the time to maturity affect the extent to which interest rate changes affect the bond’s price? (Again, an example might help you answer this question.)NOTE GIVE CONCEPTUAL ANSWER IN SHORTMoney duration is the appropriate measure of interest rate risk for bonds with embedded options. Select one: True False