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.

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Definitions:

Beliefs

Cognitive representations about the world, oneself, or others, that are accepted by an individual as true or existing.

Evolutionary Psychology

A theoretical approach in the social and natural sciences that examines psychological structure from a modern evolutionary perspective.

Cognitive Strategies

Techniques or methods that individuals use to process information more effectively, enhance memory, and solve problems.

Natural Environment

The physical world that includes all living and non-living things occurring naturally on Earth, outside of human creations or modifications.