An effect of interest rate risk and investment risk ... - Solved MCQs & Answer

462FinanceMedium

An effect of interest rate risk and investment risk on a bond’s yield is classified as_________?

AInvestment risk premium

BMaturity risk premium

CDefaulter’s premium

DReinvestment premium

Correct answer

B. Maturity risk premium

Explanation

Maturity risk premium is the correct answer. Review the question and compare it with the other choices to remember this fact for future exams.

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