Consider a Bond with a Duration of 6 Years Having

question 50

Multiple Choice

Consider a bond with a duration of 6 years having a yield to maturity of 8% and interest rates are expected to rise by 50 basis points. What is the percentage change in the price of the bond?

• A)2.88%
• B)3.45%
• C)-3.89%
• D)-3.45%
• E)-2.88%

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Definitions:

Medical Coverage

An insurance benefit that covers the cost of an individual's healthcare needs, usually provided by employers or purchased individually.

Workers' Compensation

Insurance that provides financial benefits and medical care to employees who are injured or become ill as a direct result of their job.

Profit Sharing

An employee benefit scheme where a portion of a company's profits is distributed to the employees, strengthening their investment in the company's success.

Pay-for-Knowledge

A compensation strategy that rewards employees for acquiring and utilizing additional skills or knowledge that contribute to their job performance and organizational success.