Which of the Following Statements Is Correct

question 97

Multiple Choice

Which of the following statements is correct?

• A) A 10-year bond would have more interest rate price risk than a 5-year bond,but all 10-year bonds have the same interest rate price risk.
• B) A 10-year bond would have more reinvestment rate risk than a 5-year bond,but all 10-year bonds have the same reinvestment rate risk.
• C) If their maturities were the same,a 5 percent coupon bond would have more interest rate price risk than a 10 percent coupon bond.
• D) If their maturities were the same,a 5 percent coupon bond would have less interest rate price risk than a 10 percent coupon bond.
• E) Zero-coupon bonds have more interest rate price risk than any other type bond,even perpetuities.

---

Definitions:

Gross Profit

The difference between sales revenue and the cost of goods sold before deducting operating expenses, interest, and taxes.

Period

A specific duration of time used for financial reporting and analysis, typically a fiscal quarter or year.

Cost of Goods Sold

Direct expenditures linked to the creation of goods sold by a business.

Calculate

To determine something mathematically, such as a sum, total, or other numeric value.