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Esthela Nieto
on Nov 04, 2024

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Ceteris paribus, the duration of a bond is positively correlated with the bond's

A) time to maturity.
B) coupon rate.
C) yield to maturity.
D) All of the options are correct.
E) None of the options are correct.

Bond Duration

A measure of the sensitivity of a bond's price to changes in interest rates, expressed in years.

Time To Maturity

The remaining duration until the expiration date of a financial instrument, when its principal is due to be paid to holders.

Coupon Rate

The annual interest rate paid on a bond, expressed as a percentage of the bond's face value, and paid to bondholders at specified intervals until maturity.

  • Uncover the components that affect the length of time bonds last and their price variability.
  • Assess the influence of yield to maturity, coupon rate, and the time period until maturity on the longevity of bonds.
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AG
Angelica GanataNov 04, 2024
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