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Q: You hold 3 bonds in a portfolio: A 20 year zero coupon bond A 10 year corporate bond paying a 4% coupon A 10

Q: You hold 3 bonds in a portfolio:

A 20 year zero coupon bond

A 10 year corporate bond paying a 4% coupon

A 10 year junk bond paying a 6.5% coupon

The Federal Reserve is expected to raise rates by 1% this year. Which of these three bonds will be affected the most?

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