Which of the Following Is Indicated by High Numerical Value

question 83

Multiple Choice

Which of the following is indicated by high numerical value of the duration of an asset?

• A)Low sensitivity of an asset price to interest rate shocks.
• B)High interest inelasticity of a bond.
• C)High sensitivity of an asset price to interest rate shocks.
• D)Lack of sensitivity of an asset price to interest rate shocks.
• E)Smaller capital loss for a given change in interest rates.

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Definitions:

Aggregate Supply Curve

displays the total output of goods and services that firms in an economy are willing to produce and sell at different price levels, in a given time period.

Cost-Push Inflation

Inflation caused by increases in the costs of production, such as raw materials or wages, leading to a decrease in supply and an increase in prices.

Demand-Pull Inflation

A situation where prices rise because the demand for goods and services exceeds their supply in the economy.

Aggregate Demand

The total amount of goods and services demanded in the economy at a given overall price level and in a given time period.