The Shorter the Amount of Time Until a Bond's Maturity

question 144

True/False

The shorter the amount of time until a bond's maturity, the more responsive is its market value to a given change in the required return.

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Definitions:

Correlational Research

A type of research methodology that examines the relationship between two or more variables to determine if they are connected or correlated in some way.

Correlation Coefficients

A statistical measure that indicates the extent to which two variables fluctuate together. A value closer to 1 or -1 indicates a stronger relationship.

Magnitude

A measure of the size, amount, or extent of something.

Direction of Relationship

The pattern or trend that describes how two variables are associated with each other in a correlational study, indicating whether they move together in the same or opposite directions.