You expect interest rates to decline and wish to capitalize on the anticipated changes in bond prices.
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Question:
You expect interest rates to decline and wish to capitalize on the anticipated changes in bond prices. To realize your maximum gain, all else constant, you should purchase _____bonds?
a. short-term; low coupon
b. short term;high coupon
c long-term; zero coupon
d long-term; low coupon
e long-term; high coupon
Related Book For
Investment Analysis and Portfolio Management
ISBN: 978-0538482387
10th Edition
Authors: Frank K. Reilly, Keith C. Brown
Posted Date: