The Only Case for Which the Bond Price Does Not

question 27

Multiple Choice

The only case for which the bond price does not react to a change in the yield to maturity is when

• A)the bond is a U.S. Treasury security.
• B)the bond's coupon rate equals its current yield.
• C)the bond's market price equals its par value.
• D)the bond's holding period is the same as the number of years to maturity.

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Definitions:

Changing Structure

The process of modifying the organizational, physical, or conceptual framework of an entity.

Integrator

a person or tool that brings together or synthesizes different elements, systems, or components into a coherent whole.

Liaison Between Groups

A role or function that facilitates communication and coordination between different groups or departments within an organization.

Compromise Mechanism

A strategy used in conflict resolution where each party gives up something to reach a mutually acceptable solution.