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#bonds #finance

Question

market price of a 17-year bond with a duration of 7 would [...]if the market interest rate increased by 1% per annum.

Answer

fall about 7%

Tags

#bonds #finance

Question

market price of a 17-year bond with a duration of 7 would [...]if the market interest rate increased by 1% per annum.

Answer

?

Tags

#bonds #finance

Question

market price of a 17-year bond with a duration of 7 would [...]if the market interest rate increased by 1% per annum.

Answer

fall about 7%

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market price of a 17-year bond with a duration of 7 would fall about 7% if the market interest rate increased by 1% per annum.

#### Original toplevel document

**Bond valuation - Wikipedia, the free encyclopedia**

of the bond's price with respect to discount rates. For example, for small interest rate changes, the duration is the approximate percentage by which the value of the bond will fall for a 1% per annum increase in market interest rate. So the <span>market price of a 17-year bond with a duration of 7 would fall about 7% if the market interest rate (or more precisely the corresponding force of interest) increased by 1% per annum. Convexity is a measure of the "curvature" of price changes. It is needed because the price is not a linear function of the discount rate, but rather a convex function of the di

market price of a 17-year bond with a duration of 7 would fall about 7% if the market interest rate increased by 1% per annum.

of the bond's price with respect to discount rates. For example, for small interest rate changes, the duration is the approximate percentage by which the value of the bond will fall for a 1% per annum increase in market interest rate. So the <span>market price of a 17-year bond with a duration of 7 would fall about 7% if the market interest rate (or more precisely the corresponding force of interest) increased by 1% per annum. Convexity is a measure of the "curvature" of price changes. It is needed because the price is not a linear function of the discount rate, but rather a convex function of the di

status | not learned | measured difficulty | 37% [default] | last interval [days] | |||
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repetition number in this series | 0 | memorised on | scheduled repetition | ||||

scheduled repetition interval | last repetition or drill |

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