_____ Is Defined as the Sensitivity of the Hedge Portfolio's

question 9

Multiple Choice

_____ is defined as the sensitivity of the hedge portfolio's yield to maturity to movements in the yield to maturity of the portfolio one is trying to hedge.

• A)Contingent immunization
• B)Modified duration
• C)Yield beta
• D)Convexity

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Definitions:

Real GDP

Real GDP, or Gross Domestic Product adjusted for inflation, measures the value of all final goods and services produced by an economy in a given period, providing a more accurate economic growth figure.

GDP Deflator

An economic metric that converts output measured at current prices into constant-dollar GDP, allowing for the comparison of economic productivity over time by removing the effect of inflation.

GDP Deflator

A valuation of the price tiers for all new, domestic-origin, final goods and services within an economic setting.

Inflation Rate

How quickly the general pricing level of goods and services rises, making the purchasing power weaken.