What Is the Percentage Change in a 10-Year Zero-Coupon Bond

question 72

Multiple Choice

What is the percentage change in a 10-year zero-coupon bond with a duration of 10 years,when interest rates increase from 3% to 4%?

• A)-9.2%
• B)-10%
• C)-9.8%
• D)-10.4%
• E)-8.7%

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Definitions:

Invest

The act of allocating resources, usually money, with the expectation of generating an income or profit.

Money Order

A certificate of guaranteed payment, which may be purchased from a bank, a post office, or some convenience stores.

Daily Log

A record kept every day, detailing activities, observations, or the progress of a project or health condition.

Ledger Card

A card or digital record used in accounting to record transactions affecting a particular account.