Which of the Following Statements Is CORRECT

question 34

Multiple Choice

Which of the following statements is CORRECT?

• A)A zero coupon bond of any maturity will have more interest rate price risk than any coupon bond, even a perpetuity.
• B)If their maturities and other characteristics were the same, a 5% coupon bond would have more interest rate price risk than a 10% coupon bond.
• C)A 10-year coupon bond would have more reinvestment rate risk than a 5-year coupon bond, but all 10-year coupon bonds have the same amount of reinvestment rate risk.
• D)A 10-year coupon bond would have more interest rate price risk than a 5-year coupon bond, but all 10-year coupon bonds have the same amount of interest rate price risk.
• E)If their maturities and other characteristics were the same, a 5% coupon bond would have less interest rate price risk than a 10% coupon bond.

---

Definitions:

International Trade

International trade involves the exchange of goods, services, and capital across international borders or territories, influenced by factors such as comparative advantage, exchange rates, and global economic policies.

Standards of Living

A measure of wealth, comfort, material goods, and necessities available to a certain socioeconomic class or geographic area.

Opportunity Costs

Eliminating possible positive outcomes from alternative selections by choosing one.

Worse Off

A situation or condition in which an individual or group is disadvantaged or in a less favorable position than before.