In General,all Other Factors Held Constant,the Longer the Time to Maturity

question 72

Multiple Choice

In general,all other factors held constant,the longer the time to maturity of bonds,the smaller the rate of the change of value will be.This property of coupon bonds is often referred to as:

• A) duration.
• B) coupon effect.
• C) convexity.
• D) yield effect.

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Definitions:

External Attribution

The process of assigning the cause of one's own or others' behaviors to external factors or circumstances beyond the individual's control.

Illusory Correlation

The phenomenon of perceiving a relationship between variables (typically people, events, or behaviors) even when no such relationship exists.

False Uniqueness Effect

Refers to an individual's tendency to underestimate the commonality of one's abilities and one's desirable or successful behaviors.

Self-Fulfilling Prophecy

A prediction that ensures, by the behavior it generates, that it will come true.