The Interest-Rate Risk of a Bond Is

question 16

Multiple Choice

The interest-rate risk of a bond is

• A) the risk related to the possibility of bankruptcy of the bond's issuer.
• B) the risk that arises from the uncertainty of the bond's return caused by changes in interest rates.
• C) the unsystematic risk caused by factors unique in the bond.
• D) a and b above.
• E) a,b,and c above.

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Definitions:

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