Which of the Following Statements Is Correct

question 97

Multiple Choice

Which of the following statements is correct?

• A) A 10-year bond would have more interest rate price risk than a 5-year bond,but all 10-year bonds have the same interest rate price risk.
• B) A 10-year bond would have more reinvestment rate risk than a 5-year bond,but all 10-year bonds have the same reinvestment rate risk.
• C) If their maturities were the same,a 5 percent coupon bond would have more interest rate price risk than a 10 percent coupon bond.
• D) If their maturities were the same,a 5 percent coupon bond would have less interest rate price risk than a 10 percent coupon bond.
• E) Zero-coupon bonds have more interest rate price risk than any other type bond,even perpetuities.

---

Definitions:

Demand For

The quantity of a good or service that consumers are willing and able to purchase at a given price over a specific period.

Equilibrium Price

The price at which the quantity of a good demanded by consumers equals the quantity supplied by producers, leading to a stable market condition.

Wireless Speakers

Audio devices that use wireless technologies like Bluetooth or Wi-Fi to play music or other sounds from computers, smartphones, or other sources without the need for physical cables.

Supply of Mustard

The total amount of mustard that producers are willing and able to sell at various prices over a certain time period.