Long-Term Bonds Have Greater Interest Rate Risk Than Shorter-Term Bonds

question 44

True/False

Long-term bonds have greater interest rate risk than shorter-term bonds.

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Definitions:

Property, Plant, And Equipment

Assets in the form of land, buildings, and machinery, acquired for operations and not for resale.

Preferred Stock

Preferred stock is a class of ownership in a corporation that has a higher claim on assets and earnings than common stock, typically paying dividends before common shares and having priority in the event of a liquidation.

Dividend Preference

A feature of preferred stock that gives it priority over common stock in the payment of dividends.

Voting Rights

The entitlement of shareholders to vote on company matters, typically at the annual general meeting, proportional to the number of shares they hold.