Question: 1 5 . Consider the following two Treasury securities: Bond Price Modified duration ( years ) A $ 1 0 0 6 B $ 8
Consider the following two Treasury securities:
Bond Price Modified duration years
A $
B $
Which of the following statement is incorrect?
A for a basispoint change in interest rates, bond A has a greater estimated dollar price volatility compared to bond B
B for a basispoint change in interest rates, from an investors point of view, every dollar invested in bond B has greater volatility
C The price volatility of bond B is greater than A
D for a basispoint change, the percentage change in price of B is
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