Question: True or False. State whether the last sentence is true or false. (a) When interest rates are very high (above 6%), typically low duration bonds

True or False. State whether the last sentence is true or false.

(a) When interest rates are very high (above 6%), typically low duration bonds are cheapest to deliver for Treasury bond futures.

(b) One reason for quoting bond prices in terms of a clean price (i.e. the full price minus accrued interest) is because the quoted price will not mechanically drop whenever the bond pays out a coupon.

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