I have a little question about rates. I got it at school. Dees anyone know the answer ?
All else being constant; the respons of the market price of long-term maturity debt instruments to a given change in market interest rates is:
1. Larger than that of debt instruments with shorter term to maturity.
2. Smaller than that of debt instruments with shorter term to maturity.
3. Independent of the change in market rates of interest.
4. A given change in market rates of interest causes an identical change in the market price of debt securities of various maturities
All else being constant; the respons of the market price of long-term maturity debt instruments to a given change in market interest rates is:
1. Larger than that of debt instruments with shorter term to maturity.
2. Smaller than that of debt instruments with shorter term to maturity.
3. Independent of the change in market rates of interest.
4. A given change in market rates of interest causes an identical change in the market price of debt securities of various maturities