Question
a.) All else equal, as yields go down, bond duration goes _________ (up/down). This means that the bond price becomes ________ (more/less) sensitive to changes
a.) All else equal, as yields go down, bond duration goes _________ (up/down). This means that the bond price becomes ________ (more/less) sensitive to changes in interest rates as yields are lower, all else equal.
b.) All else equal, as coupon rates go down, bond duration goes ________ (up/down). This means that the bond price becomes ________ (more/less) sensitive to changes in interest rates as coupon rates are lower, all else equal.
c,) All else equal, as time to maturity goes down, bond duration goes ________ (up/down). This means that the bond price becomes ________ (more/less) sensitive to changes in interest rates as coupon rates are lower, all else equal.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started