Examlex

Solved

It Is Possible That a Bond with a Shorter Maturity

question 26

True/False

It is possible that a bond with a shorter maturity than another bond may actually have a longer duration and be more sensitive to interest rate changes.


Definitions:

Short Run

refers to a period in which at least one input in the production process is fixed and cannot be changed.

Long Run

A period in economics where all factors of production and costs are variable, allowing companies to adjust to new conditions.

Average Total Cost

The total cost of production (fixed and variable costs combined) divided by the total quantity produced, indicating the cost per unit of product.

Marginal Revenue

The additional income received from selling one more unit of a good or service.

Related Questions