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2) Consider three risk-free bonds in your portfolio, bonds E, F and G with par value of $1000. You can only keep one bond in
2) Consider three risk-free bonds in your portfolio, bonds E, F and G with par value of $1000. You can only keep one bond in the portfolio. Bond E presently is selling at par value and pays annual interest of $90. Bond F pays interest of $100 annually, while bond G is a zero-coupon bond. Bond E will mature in 15 years while bond F will mature in 13 years. Bond G has 15 years to maturity. Your forecasting model predicts that the interest rate will increase by 1%, which bond would you keep? A. Bond E. B. Bond F. C. Bond G. D. There is not enough information
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