The Investment Style of a Bond Portfolio Can Be Summarized

question 85

True/False

The investment style of a bond portfolio can be summarized by its two most important characteristics: credit quality and interest rate sensitivity.

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Definitions:

Total Utility

The total satisfaction received from consuming a certain quantity of goods or services.

Marginal Utility

is the additional satisfaction or utility that a consumer receives from consuming one more unit of a good or service.

Total Utility

The total satisfaction or benefit received by consuming a given total quantity of a good or service.

Market Equilibrium

A market state where the supply of goods matches demand, with no incentive for price to change.