You Own a Bond That Has a Duration of 6

question 1

Multiple Choice

You own a bond that has a duration of 6 years. Interest rates are currently 7%, but you believe the Fed is about to increase interest rates by 25 basis points. Your predicted price change on this bond is ________.

• A) +1.4%
• B) -1.4%
• C) -2.51%
• D) +2.51%

Understand the rights of successive assignees under the Restatement.

Analyze the legal status and rights of third-party beneficiaries.

Comprehend the legal implications of revocability and irrevocability in assignments.

Recognize the role of consideration in the validity of an assignment.

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Definitions:

Aggregate Supply Curve

A graphical representation showing the relationship between the total quantity of goods and services that producers in an economy are willing to supply at varying price levels.

Discretionary Fiscal Policy

Economic policies based on government spending and taxation decisions that are used to influence macroeconomic conditions, including aggregate demand, employment, and inflation.

Reagan Administration

The period of United States government from 1981 to 1989 when Ronald Reagan served as the President.

Fiscal Policy

Government policies regarding taxation and spending to influence the economy.