The Interest-Rate Risk That Is Associated with Bond Investing

question 51

Multiple Choice

The interest-rate risk that is associated with bond investing:

• A) exists even if an investor plans on holding the bond to maturity.
• B) arises because of a mismatch between the investor's investment horizon and the maturity of the bond.
• C) is not reflected in the risk premium.
• D) can be eliminated by holding only consols.

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Definitions:

U.S. Citizenship

The status of being a legally recognized citizen of the United States, entitled to rights, privileges, and responsibilities under U.S. law.

IP Theft

Intellectual Property Theft refers to the unauthorized use or appropriation of someone else's intellectual property, including patents, copyrights, trademarks, and trade secrets.

$225 Billion

A financial figure indicating a specific market value, revenue, or other financial measurement, context-dependent.

W-4

A form used in the United States for income tax withholding purposes, allowing employers to withhold the correct federal income tax from an employee's pay.