If You Expected Interest Rates to Rise,you Would Prefer to Own

question 31

Multiple Choice

If you expected interest rates to rise,you would prefer to own bonds with

• A) short maturities and low coupons.
• B) long maturities and high coupons .
• C) long maturities and low coupons.
• D) short maturities and high coupons.
• E) none of the above.

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Definitions:

Learning Curve

A graphical representation that shows how learning or gaining experience increases efficiency or performance over time.

Polar Coordinate

A coordinate system where each point on a plane is determined by an angle and a distance from a fixed point, called the pole.