Which Set of Conditions Will Result in a Bond with the Greatest

question 7

Multiple Choice

Which set of conditions will result in a bond with the greatest volatility?

• A) A high coupon and a short maturity
• B) A high coupon and a long maturity
• C) A low coupon and a short maturity
• D) A low coupon and a long maturity
• E) A deferred call feature and a sinking fund.

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Definitions:

Discriminatory Firings

The act of terminating employees' contracts based on biased, unfair reasons, such as age, gender, race, or religion.

Deadweight Loss

A reduction in economic effectiveness that happens when it's impossible to reach or the equilibrium result is not attained.

Demand Curve

A graph showing the relationship between the price of a good and the amount of that good consumers are willing to buy.

Tax

A binding monetary impost or other form of levy exacted upon a taxpayer by a governmental unit to finance the operation of the government and various public services expenses.