Quiz Ch 03 – Bond Sensitivity to Interest Rate Change
Principles of Corporate Finance
Brealey, Myers, and Allen
13th Edition
Which bond is more responsive to a 0.75 percent interest rate change?
Which bond is more responsive to a 0.75 percent interest rate change?
Determine the duration of a bond with a face value of $1,000, no coupon rate, a yield to maturity of 9%, and a maturity period of 10 years:
In your capacity as CFO, and holding all other factors constant, which outcome would you favor concerning the price of your corporation’s bonds?
Which correctly characterizes the relationship between bond prices and interest rates?
How is the volatility of a bond determined?