Which of the Following Bonds Has the Greatest Interest Rate

Which of the following bonds has the greatest interest rate price risk?

A) a 10-year, $1,000 face value, zero coupon bond.
B) a 10-year, $1,000 face value, 10% coupon bond with annual interest payments.
C) all 10-year bonds have the same price risk since they have the same maturity.
D) a 10-year, $1,000 face value, 10% coupon bond with semiannual interest payments.
E) a 10-year $100 annuity.

Correct Answer:

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