Solve the Problem $\frac { 3 } { 19 }$ B) $\frac { 1 } { 4 }$

question 89

Multiple Choice

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Definitions:

Par Value Bond

A bond that is selling for its original face value, as opposed to above (a premium) or below (a discount).

Modified Duration

A measure of the sensitivity of a bond's price to changes in interest rates, indicating the price change in percentage terms for a yield move of one percent.

Macaulay Duration

A measure of the weighted average time until a bond's cash flows are paid back, used to assess interest rate risk.