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Which one is true? a. the higher the coupon payment, the lower the bond’s duration b....

Which one is true?
a. the higher the coupon payment, the lower the bond’s duration
b. the higher the yield to maturity, the lower the bond’s duration
c. duration increases with maturity but at a decreasing rate
d. all of the above
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Answer #1

Option A. the higher the coupon payment, the lower the bond’s duration

As the Bond wiith higher coupon payment will have a lower Bond's duration as Higher Coupon Payments will pay back the Price of Bond early than the Bond with lower Couon rate.

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