For an Absolute Change in Interest Rates, the Price Gain

question 28

Multiple Choice

For an absolute change in interest rates, the price gain on a bond caused by a decrease in yield is ________ the price loss caused by an increase in yield.

• A) greater than
• B) the same as
• C) less than
• D) Greater than if the bond is selling at a premium, less than if the bond is selling at a discount.
• E) Greater than if the bond is selling at a discount, less than if the bond is selling at a premium.

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Definitions:

Cognitive Abilities

A term referring to the mental skills and functions related to the acquisition, processing, and use of knowledge, including memory, reasoning, and problem-solving.

Late Adulthood

A life stage characterized by the aging process, typically considered to begin around the age of 65, marked by changes in physical, cognitive, and social functioning.

Stability

signifies a state or condition of being steady, constant, and unchanged over time.

Ecological Validity

The idea that cognition should be measured in settings that are as realistic as possible and that the abilities measured should be those needed in real life.