Which of the following statements is true about bond theorems? ( a. For a given change in the interest rate, long-term bonds have higher interest rate risk than short-term bonds. b. Bond prices are positively related to interest rate movements. c. If interest rates are expected to decrease, investors should avoid investing in long-term zero-coupon bonds. d. For a given change in the int ast rate, lower coupon bonds bear lower interest rate risk than higher coupon bonds.
Which of the following statements is true about bond theorems? ( a. For a given change in the interest rate, long-term bonds have higher interest rate risk than short-term bonds. b. Bond prices are positively related to interest rate movements. c. If interest rates are expected to decrease, investors should avoid investing in long-term zero-coupon bonds. d. For a given change in the int ast rate, lower coupon bonds bear lower interest rate risk than higher coupon bonds.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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