Which of the Following Statements Is True

question 11

Multiple Choice

Which of the following statements is true?

• A) If duration > investment horizon, the investor faces net reinvestment risk.
• B) If duration < investment horizon, the investor faces net price risk.
• C) If duration = investment horizon, the investor is immunised.
• D) All of the above statements are true.
• E) None of the above statements are true.

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Definitions:

Causation

The relationship between cause and effect, where one event or action directly results in another.

Experiments

Systematic and scientific procedures carried out under controlled conditions to investigate a hypothesis or demonstrate a known fact.

Parental Support

The assistance and backing provided by parents to their children, which can be emotional, physical, or financial in nature.

Lower Grades

Academic scores or assessments that are below the expected or desired standard or average.