The Error from Using Duration to Estimate the New Price

question 122

True/False

The error from using duration to estimate the new price of a fixed-income security will be less as the amount of convexity increases.

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Definitions:

Bits

The smallest unit of data in computing, representing a binary value of either 0 or 1.

Character Codes

Character codes are numerical values that represent specific characters in a character encoding set, such as ASCII or Unicode.

Main Memories

Refers to the primary storage or RAM of a computer, where programs and data are kept for quick access by the processor.

Word

In computing, it represents a fixed-sized piece of data handled as a unit by the instruction set or the hardware of the processor.