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Duration Is a Direct Measure of the Interest Rate Sensitivity

Question 2

Multiple Choice

Duration is a direct measure of the interest rate sensitivity of an asset or liability, which means that:


A) the smaller the duration, the more sensitive the price of that asset or liability
B) the larger the duration, the less sensitive the price of that asset or liability
C) the larger the duration, the more sensitive the price of that asset or liability
D) None of the listed options are correct.

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