Par-Value-Bond F Has a Modified Duration of 9

question 34

Multiple Choice

Par-value-bond F has a modified duration of 9. 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 $90.
• B) If the market yield increases by 1%, the bond's price will increase by $90.
• C) If the market yield increases by 1%, the bond's price will decrease by $60.
• D) If the market yield decreases by 1%, the bond's price will increase by $60.