Which of the Following Bonds Has the Greatest Interest Rate

question 1

Multiple Choice

Which of the following bonds has the greatest interest rate price risk?

• A) A 10-year $100 annuity.
• B) A 10-year, $1,000 face value, zero coupon bond.
• C) A 10-year, $1,000 face value, 10% coupon bond with annual interest payments.
• D) All 10-year bonds have the same price risk since they have the same maturity.
• E) A 10-year, $1,000 face value, 10% coupon bond with semiannual interest payments.