A Deviation from a Financial Plan Is Called A(n)

question 20

Multiple Choice

A deviation from a financial plan is called a(n) :

• A) departure.
• B) allocation.
• C) variance.
• D) uncontrollable cost.

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Definitions:

Coupon Rate

The per annum interest rate of a bond, depicted as a percentage of its principal amount.

Zero-Coupon Bond

A financial instrument that pays no regular interest, sold at a significant discount and redeemed for its full face value at maturity.

Duration

A measure of the sensitivity of the price of a bond or other debt instrument to changes in interest rates, often used to estimate the price's volatility.

Coupon Bond

A type of bond that pays the holder a fixed interest rate (coupon) periodically until the maturity date, at which point the principal amount is paid back.