For given change in interest rates, the percentage change in the present value of bond is classified as __________?
Correct answer: A. price sensitivity
- A. price sensitivity
- B. yield sensitivity
- C. maturity sensitivity
- D. premium sensitivity
Explanation
Price sensitivity describes how much a bond's present value or market price changes when interest rates change. Duration is the main technical measure used to quantify this sensitivity, but it is not one of the listed choices.
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