A Bond Has a Modified Duration of 7

question 91

Multiple Choice

A bond has a modified duration of 7.22 and a yield to maturity of 8.1 percent.If interest rates increase by 75 basis points,the bond's price will decrease by ________ percent.

• A) -0.46
• B) -0.54
• C) -4.60
• D) -5.42
• E) -6.18

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Definitions:

Cultural Group

A collection of individuals who share a common culture, including practices, values, and beliefs that distinguish them from other groups.

Americans

Residents or citizens of the United States of America, encompassing a wide diversity of ethnic backgrounds, cultures, and traditions.

Dimensional Approach

A method of categorizing characteristics on a continuum rather than as binary states, often used to analyze personality or mental health disorders.

Emotional Experience

The complex psychological state involving an individual's subjective experience, physiological response, and behavioral expression in response to an emotion-evoking stimulus.