The Modified Duration

question 42

Multiple Choice

The modified duration:

• A) is equal to the Macaulay duration divided by (1 + Yield to maturity).
• B) multiplied by (-1 * Change in the yield to maturity) equals the approximate percentage change in a bond's price.
• C) will be the same for any bonds that have equal times to maturity.
• D) only applies to pure discount securities.
• E) must be converted to a Macaulay duration before computing the percentage change in a bond's price.