Interest-rate risk refers to the potential decline in a security's price as interest rates rise.

Name: Interest-rate risk refers to the potential decline in a security's price as interest rates rise.
Brand: Quizplus
Rating: 4.7 (32 reviews)

Question

Quizplus · Accepted Answer

Interest-rate risk is the risk of a decline in the value of a security due to changes in the prevailing interest rates. As interest rates rise, the value of fixed-income securities decreases, causing their prices to fall. Therefore, this statement is true.

Interest-Rate Risk Refers to the Potential Decline in a Security's