Question
Consider the following bonds: Bond Years till maturity Coupon % A 5 5.5 B 9 4.0 C 14 5.0 D 21 3.5 Currently, the yield
Consider the following bonds:
| Bond | Years till maturity | Coupon % |
| A | 5 | 5.5 |
| B | 9 | 4.0 |
| C | 14 | 5.0 |
| D | 21 | 3.5 |
Currently, the yield on similar bonds is 5.0%. If the interest rates decrease to 4.75%, which of the bonds is subject to a greater interest rate risk?
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Income Tax Fundamentals 2013
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
31st Edition
1111972516, 978-1285586618, 1285586611, 978-1285613109, 978-1111972516
