Business, 23.03.2020 18:31 teddybear8728

An investor holds two bonds, one with 5 years until maturity and the other with 20 years until maturity. Which of the following is more likely if interest rates suddenly increase by 2%? 1)The 5-year bond will decrease more in price. 2)The 20-year bond will decrease more in price. 3)Both bonds will decrease in price similarly. 4)Neither bond will decrease in price, but yields will increase. please explain

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An investor holds two bonds, one with 5 years until maturity and the other with 20 years until matur...

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