Asked by
Asbah Ahmed
on Nov 04, 2024
Verified
Which of the following bonds has the longest duration?
A) A 12-year maturity, 0% coupon bond.
B) A 12-year maturity, 8% coupon bond.
C) A 4-year maturity, 8% coupon bond.
D) A 4-year maturity, 0% coupon bond.
E) Cannot tell from the information given
Maturity
Is the expiration date of a financial instrument, at which point the principal (or final interest payment) is repaid to the investors.
- Absorb knowledge on how the rates of coupons and maturity intervals affect bond duration.
Verified Answer
MD
Learning Objectives
- Absorb knowledge on how the rates of coupons and maturity intervals affect bond duration.