Suppose the Duration of a Bond Portfolio Is 2

question 13

Multiple Choice

Suppose the duration of a bond portfolio is 2.This means

• A)The final cash flow from the portfolio will occur in two years.
• B)The weighted-average maturity of the portfolio's cash flows is 2 years.
• C)The portfolio is fully equivalent to a 2-year zero-coupon bond.
• D)The portfolio is fully equivalent to a 2-year par-coupon bond.

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