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With any other factors remaining unchanged, which of the following statements regarding bonds is not valid? The price of a callable bond increases when interest
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With any other factors remaining unchanged, which of the following statements regarding bonds is not valid?
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The price of a callable bond increases when interest rates increase
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Issuance of a callable bond is equivalent to a short position in a straight bond plus a long call option on the bond price
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The put feature in a puttable bond lowers its yield compared with the yield of an equivalent straight bond
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Duration is a function of time and yield
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