A Portfolio of Bonds Is Immunized from Interest Rate Risk

question 43

True/False

A portfolio of bonds is immunized from interest rate risk if the duration of the portfolio is always equal to the desired investment horizon.

Comprehend the significance of the cost of capital in project evaluation and its calculation.

Recognize the challenges in evaluating mutually exclusive projects and the solutions to those challenges.

Understand the principles and application of the profitability index in investment decision making.

Analyze the concepts of capital budgeting decisions, including capital rationing and project selection based on financial metrics.