Asked by
brianna bailey
on Dec 08, 2024Verified
When interest rates decline, the duration of a 10-year bond selling at a premium
A) increases.
B) decreases.
C) remains the same.
D) increases at first, then declines.
E) decreases at first, then increases.
Interest Rates
The cost of borrowing money or the reward for saving, typically expressed as a percentage of the principal.
Premium
The amount by which the price of a financial instrument or insurance policy exceeds its face value or the cost above the normal price.
- Establish the factors that have an effect on the longevity of bonds and how these aspects influence price fluctuation.
Verified Answer
KK
Learning Objectives
- Establish the factors that have an effect on the longevity of bonds and how these aspects influence price fluctuation.
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