Which One of the Following Bonds Would Be Likely to Exhibit

question 60

Multiple Choice

Which one of the following bonds would be likely to exhibit a greater degree of interest rate risk?

• A) A zero-coupon bond with 20 years until maturity
• B) A coupon-paying bond with 20 years until maturity
• C) A floating-rate bond with 20 years until maturity
• D) A zero-coupon bond with 30 years until maturity

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Definitions:

Italian Renaissance

A period of great cultural change and achievement in Italy that began in the 14th century, characterized by advancements in art, architecture, literature, and science.

Idealism

A philosophical approach asserting that reality, or reality as we can know it, is fundamentally mental, mentally constructed, or otherwise immaterial.

Realism

An artistic, literary, and intellectual movement that rejects idealization, focusing on depicting subjects as they are perceived in everyday life.

Religious Order

An organization of individuals who live under religious vows and dedicate their lives to spiritual goals, following a specific set of rules.