Increasing the Coupon Rate and Decreasing the Time to Maturity

question 18

True/False

Increasing the coupon rate and decreasing the time to maturity will increase the interest rate risk of a bond.

---

Definitions:

π Bonds

Covalent bonds formed by the sideways overlap of two p-orbitals, containing a pair of electrons located above and below the axis of the bonded atoms.

Hybridization

A concept in chemistry where atomic orbitals mix to form new hybrid orbitals, explaining the geometry of molecular bonding.

Indicated Atom

A specific atom within a molecule that is highlighted or referenced, typically in the context of chemical reactions or structural discussions.

Hybridization

A concept in molecular chemistry that describes the mixing of atomic orbitals to form new hybrid orbitals suitable for the pairing of electrons to form chemical bonds.