Option Adjusted Duration Can Be Calculated as

question 111

Multiple Choice

Option adjusted duration can be calculated as

• A) duration of noncallable bond - duration of call option on the bond.
• B) duration of noncallable bond + duration of call option on the bond.
• C) duration of callable bond - duration of call option on the bond.
• D) duration of callable bond + duration of call option on the bond.
• E) None of these are correct.

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Definitions:

Inventory Control

The regulation of inventory levels within a business to manage supply, minimize costs, and prevent shortages or surpluses.

Just-In-Time (JIT) System

A supply chain management strategy that reduces inventory costs by delivering raw materials and components just as they are needed in the production process.

Sudden Increase In Demand

A rapid and unexpected rise in the desire or need for a specific product or service, which can impact market dynamics.

Long-Term Relationships

Enduring associations between companies and their stakeholders, such as customers or suppliers, typically characterized by trust, loyalty, and mutual benefit over time.