An Increase in a Bond's Yield to Maturity Results in a Price

question 19

Multiple Choice

An increase in a bond's yield to maturity results in a price decline that is ________ the price increase resulting from a decrease in yield of equal magnitude.

• A) greater than
• B) equivalent to
• C) smaller than
• D) The answer cannot be determined.

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Definitions:

Valid Contract

An agreement that meets all legal requirements, including offer, acceptance, consideration, and the intention to create a legal relationship, thereby enforceable by law.

Courts

Institutions that administer justice through the interpretation and application of laws.

Fraudulent Misrepresentation

The act of deliberately providing false information or deceiving another party, leading to harm or loss.

Odometer

An odometer is a device used to measure the distance traveled by a vehicle, typically recorded in miles or kilometers.