Duration is a measure of the:
A) yield to maturity of a bond.
B) coupon yield of a bond.
C) price of a bond.
D) effective maturity of a bond.
E) All of

Question

Quizplus · Accepted Answer

Duration is a measure of the effective maturity of a bond. It takes into account both the timing of the bond's cash flows and the present value of those cash flows, providing a measure of the bond's sensitivity to changes in interest rates. Duration is not directly related to yield to maturity, coupon yield, or price. Therefore, options A, B, and C are incorrect.

Duration Is a Measure of The