A Bond with Duration of 10 Years Has Yield to Maturity

question 30

Multiple Choice

A bond with duration of 10 years has yield to maturity of 10%. This bond's volatility is:

• A) 9.09%
• B) 6.8%
• C) 14.6%
• D) 6.0%

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Definitions:

Post-Closing Trial Balance

A list of all the accounts and their balances after the closing entries are made, ensuring that debits equal credits in the ledger.

Dividends

Disbursements issued by a company to its shareholders, allocating a fraction of the company's profits.

Common Stock

A form of corporate equity ownership, a type of security representing unit ownership in a corporation, with voting rights and potential dividends.

Cash

The most liquid asset, representing currency or bank balances that can be used immediately to settle debts.