Duration facilitates the comparison of bonds with differing ________.
A) default risks
B) conversion ratios
C) maturities
D) yields to maturity

Question

Quizplus · Accepted Answer

Duration is a measure of the sensitivity of a bond's price to changes in interest rates, and it takes into account the bond's remaining time to maturity. Therefore, it is particularly helpful in comparing bonds with different maturities. Bonds with longer maturities generally have greater durations because they are more sensitive to changes in interest rates over a longer period of time.

Duration Facilitates the Comparison of Bonds with Differing ________