A Bond Has an Annual Modified Duration of 7

question 11

Multiple Choice

a bond has an annual modified duration of 7.140 and annual convexity of 66.200. The bond's yield-to-maturity is expected to increase by 50 basis points. The expected percent-Age price change is closest to:

• A) −3.40%.
• B) −3.49%.
• C) −3.57%

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Definitions:

One-Way Street

A situation or condition that allows movement or action in only one direction, often used metaphorically to describe a non-reciprocal relationship.

Acceptability

The quality of being accepted as appropriate, suitable, or worthy of approval.

Negative Evaluative Adjectives

Adjectives used to express a negative judgment or assessment of something.

Evaluative Adjectives

Descriptive words used to express a judgment or assessment of something, often in terms of quality, quantity, or degree.