The Duration of a Portfolio of Bonds Can Be Calculated

question 45

Multiple Choice

The duration of a portfolio of bonds can be calculated as ________.

• A) the coupon weighted average of the durations of the individual bonds in the portfolio
• B) the yield weighted average of the durations of the individual bonds in the portfolio
• C) the value weighted average of the durations of the individual bonds in the portfolio
• D) averages of the durations of the longest- and shortest-duration bonds in the portfolio

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Definitions:

Nature-Nurture

A debate concerning the relative importance of an individual's innate qualities (nature) versus personal experiences (nurture) in determining or causing differences in physical and behavioral traits.

Heredity

The transmission of genetic characteristics from parents to offspring.

Environment

The sum of all external conditions affecting the life, development, and survival of an organism.

Discontinuous Change

An aspect of development that is characterized by abrupt or stage-like change.