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A Rising Price for Gasoline May Mean That New-Home Builders

question 129

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A rising price for gasoline may mean that new-home builders switch from using asphalt for driveways to using brick for driveways.


Definitions:

Interest-Rate Sensitivity

A measure of how much the value of an investment or a portfolio will change in response to a change in interest rates.

Bond Prices

The cost at which a bond is trading, which can fluctuate based on interest rates, the bond's credit quality, and other factors.

Coupon Rate

The per annum interest rate of a bond, depicted as a percentage of its principal amount.

Zero-Coupon Bond

A financial instrument that pays no regular interest, sold at a significant discount and redeemed for its full face value at maturity.

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