If Its Yield to Maturity Declined by 1%, Which of the Following

question 76

Multiple Choice

If its yield to maturity declined by 1%, which of the following bonds would have the largest percentage increase in value?

• A) a 1-year bond with an 8% coupon.
• B) a 10-year bond with an 8% coupon.
• C) a 10-year bond with a 12% coupon.
• D) a 10-year zero coupon bond.
• E) a 1-year zero coupon bond.

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Definitions:

Personality Traits

Enduring patterns of thought, feeling, and behavior that characterize an individual across different situations and over time.

External Influences

Factors originating outside an individual that significantly affect their behaviors, decisions, and attitudes.

Implicit

Something implied or understood though not directly expressed.

Explicit

Something clearly and directly expressed or demonstrated, leaving no room for confusion or interpretation.