Which of the Following Bonds Will Be Least Sensitive to a Change

question 32

Multiple Choice

Which of the following bonds will be least sensitive to a change in interest rates?

• A) a ten-year bond with a $2,000 face value whose yield to maturity is 5.8% and coupon rate is 5.8% APR paid semiannually
• B) a 15-year bond with a $5,000 face value whose yield to maturity is 7.4% and coupon rate is 6.2% APR paid annually
• C) a 20-year bond with a $3,000 face value whose yield to maturity is 6.0% and coupon rate is 5.4% APR paid semiannually
• D) a 30-year bond with a $1,000 face value whose yield to maturity is 5.5% and coupon rate is 6.4% APR paid annually

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Definitions:

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The idea that facial expressions can influence emotions and reflect them.

James-Lange Theory

A theory of emotion that suggests emotions occur as a result of physiological reactions to events.

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Variations in the practices, values, and norms of behavior among different groups of people.

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The use of facial muscles to convey emotions, thoughts, or reactions.