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A 20-Year Original Maturity Bond with One Year Left to Maturity

question 92

True/False

A 20-year original maturity bond with one year left to maturity has half the interest rate price risk of a 10-year original maturity bond with one year left to maturity. (Assume that the bonds have equal default risk and equal coupon rates.)


Definitions:

Chronic Illness

A long-term health condition that persists for months or years, often requiring ongoing medical attention and affecting daily living.

Social Support

The perception and actuality that one is cared for, has assistance available from other people, and that one is part of a supportive social network.

"Circumplex"

A term often used in psychology to describe models that are arranged in a circular structure, typically to illustrate the complex interrelations between variables.

Chronic Disease

A long-lasting condition that can be controlled but not cured, often with significant impacts on individuals' life, such as diabetes, asthma, and heart disease.

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