Duration Is

question 37

Multiple Choice

Duration is

• A)the elasticity of a security's value to small coupon changes.
• B)the weighted average time to maturity of the bond's cash flows.
• C)the time until the investor recovers the price of the bond in today's dollars.
• D)greater than maturity for deep discount bonds and less than maturity for premium bonds.
• E)the second derivative of the bond price formula with respect to the YTM.

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Definitions:

Investment Account

A financial account held at a financial institution that holds securities, such as stocks or bonds, for investment purposes.

Goodwill Impairment

An accounting charge that companies record when the value of goodwill on the balance sheet exceeds the tested fair market value.

Reporting Units

Components of a business entity for which discrete financial information is available and is reviewed by the entity's management.