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Bond prices are _______ sensitive to changes in yield when the bond is selling at a _______ initial yield to maturity.

1 Answer

3 votes

Answer: more; lower

Step-by-step explanation:

The yield to maturity is the annual rate of return for a bond which has been estimated as long as the bind is being held by the investor till it matures.

It should be noted that Bond prices are more sensitive to changes in yield when the bond is selling at a lower initial yield to maturity.

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User MindTooth
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