The Holding Period for a Bond at Which the Coupon

question 15

Multiple Choice

The holding period for a bond at which the coupon reinvestment risk offsets the market price risk is best approximated by:

• A) duration gap.
• B) modified duration.
• C) Macaulay duration.

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Definitions:

Good Faith Bargaining

The principle that both parties in negotiations, such as employers and unions, must participate honestly and sincerely to reach a mutually acceptable agreement.

Careless Worker Model

The early approach to safety in the workplace, which assumed that most accidents were due to workers’ failure to be careful or to protect themselves.

Accidents

Unplanned events that result in injury or harm to individuals, damage to property, or a combination thereof.

Industrial Diseases

Ailments contracted as a result of exposure to risk factors or unhealthy conditions in the workplace.