Question

Which of the following bonds has the greatest price risk? a. A 10-year $100 annuity. b. A 10-year, $1,000 face value, zero coupon bond. c. A 10-year, $1,000 face value, 10% coupon bond with annual interest payments. d. All 10-vear bonds have the same price risk since they have the same maturity, e. A 10-year, $1,000 face value, 10% coupon bond with semiannual interest payments.

Fig: 1

Fig: 2

Fig: 3

Fig: 4

Fig: 5

Fig: 6