Multiple Choice
A company has two outstanding bonds with the same features,apart from the maturity date.Bond A matures in five years,while bond B matures in 10 years.If the market interest rate changes by 5%:
A) bond A will have the greater change in price.
B) bond B will have the greater change in price.
C) the price of the bonds will not alter.
D) the price of the bonds will change by the same amount.
Correct Answer:
Verified
Correct Answer:
Verified
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