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Unformatted text preview: B) more; higher C) less; lower D) None of the above answers are correct 4. Duration is a concept that is useful in assessing a bond's __________. A) credit risk B) liquidity risk C) interest rate risk D) None of the above 5. Duration always __________ as time to maturity increases for _______________. A) increases; bonds selling at a discount B) increases; bonds selling at or above par C) decreases; all bonds D) More than one of the above 6. A bond presently has a price of $1,030. The present yield on the bond is 8.00%. If the yield changes from 8.00% to 8.10%, the price of the bond will go down to $1,020. The duration of this bond is __________. A) -10.5 B) -8.5 C) 9.7 D) 10.5...
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This note was uploaded on 05/10/2008 for the course FIN 367 taught by Professor Han during the Spring '08 term at University of Texas at Austin.
- Spring '08