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A Bond That Has an Annual Coupon Rate of 15

Question 25
Multiple Choice

A bond that has an annual coupon rate of 15% has two years to maturity.If the current discount rate is 8%, what is the bond's Macaulay's duration? A)2.00 years B)1.99 years C)1.88 years D)1.77 years E)1.66 years

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Q 26
A bond that has an annual coupon rate of 11% has three years to maturity.If the current discount rate is 16%, what is the bond's Macaulay's duration? A)3.00 years B)2.991.years C)2.89 years D)2.79 years E)2.69 years
Q 27
A bond that with a 12% coupon rate (paid semi-annually) has two years to maturity.If the current discount rate is 10%, what is the bond's Macaulay's duration? A)4.00 years B)3.47 years C)2.00 years D)1.73 years E)1.50 years
Q 28
Which of the following is false? A)As interest rates rise, bond prices rise, everything else the same. B)Given an absolute change in interest rates, the percentage increase in a bond's price will be greater than the percentage decrease, everything else the same. C)Long-term bonds change proportionately more in price than short-term bonds for a given rate change, everything else the same. D)A bond with a lower coupon will change more in price than a bond with a higher coupon, everything else the same. E)A bond's duration is a measure of its price elasticity.
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