Determine Whether the Sequence Is Arithmetic

question 137

Multiple Choice

Determine whether the sequence is arithmetic. If so, find the common difference. 5, 25, 125, 625, 3125

• A)5
• D)-5
• E)not arithmetic

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Definitions:

Surrounding Maturity

This term appears to be less commonly used or specific; however, in context, it could refer to factors or conditions existing or occurring around the time a financial instrument reaches its maturity.

Convexity

An indicator of how the bond price's sensitivity to interest rate changes varies with the bond's yield, reflecting adjustments in the bond's duration.

Basis Points

A unit of measure used in finance to describe the percentage change in the value or rate of a financial instrument.

Duration Mismatch

The disparity between the sensitivity of asset prices and liability values to changes in interest rates, affecting firms and financial institutions' balance sheets.