• 2022-06-07
    A bond has a modified duration of 6 and a convexity of 62.5. What happens to the bond's price if interest rates rise 25 basis points It goes:()
    A: down 1.46%.
    B: up 4.00%.
    C: up 1.46%.
  • A

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      The interest rate risk of a fixed-rate bond with an embedded call option is best measured by: A: Effective duration B: Modified duration C: Macaulay duration

    • 1

      If the interest rates on all bonds rise from 5 to 6 percent over the course of the year, which bond would you prefer to have been holding?

    • 2

      Which type of bond most likely earns interest on an implied basis? A: Floater B: Conventional bond C: Pure discount bond

    • 3

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    • 4

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