Which of the following bonds would have the greatest percentage decrease in value if all interest rates in the economy rose by 1%? (Ch. 7) Group of answer choices 10-year, zero coupon bond. 1-year, 10% coupon bond. 20-year, zero coupon bond. 20-year, 5% coupon bond. 20-year, 10% coupon bond.

Which of the following bonds would have the greatest percentage decrease in value if all interest rates in the economy rose by 1%? (Ch. 7) Group of answer choices 10-year, zero coupon bond. 1-year, 10% coupon bond. 20-year, zero coupon bond. 20-year, 5% coupon bond. 20-year, 10% coupon bond.

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter4: Bond Valuation

Section: Chapter Questions

Problem 5MC: What would be the value of the bond described in Part d if, just after it had been issued, the...

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Which of the following bonds would have the greatest percentage decrease in value if all interest rates in the economy rose by 1%? (Ch. 7)

Group of answer choices

10-year, zero coupon bond.

1-year, 10% coupon bond.

20-year, zero coupon bond.

20-year, 5% coupon bond.

20-year, 10% coupon bond.

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