Explain why long-term bonds with zero coupons are riskier than short-term bonds that pay coupon interest.

Question:

Explain why long-term bonds with zero coupons are riskier than short-term bonds that pay interest.

Coupon
A coupon or coupon payment is the annual interest rate paid on a bond, expressed as a percentage of the face value and paid from issue date until maturity. Coupons are usually referred to in terms of the coupon rate (the sum of coupons paid in a...