Par-Value Bond XYZ Has a Modified Duration of 6

question 75

Multiple Choice

Par-value bond XYZ has a modified duration of 6. Which one of the following statements regarding the bond is true?

• A) If the market yield increases by 1%, the bond's price will decrease by $60.
• B) If the market yield increases by 1%, the bond's price will increase by $50.
• C) If the market yield increases by 1%, the bond's price will decrease by $50.
• D) If the market yield increases by 1%, the bond's price will increase by $60.

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Definitions:

Sediment Analysis

The study and evaluation of accumulation material like soil, rocks, and particulates in natural settings to understand environmental conditions.

Urinalysis

a series of tests performed on urine to detect and manage a wide range of disorders, such as urinary tract infections, kidney disease, and diabetes.

Volume

A measure of the amount of space that an object or substance occupies.

Glucosuria

The excretion of glucose into the urine, often an indicator of high blood sugar levels or diabetes.