which of the following bond would have the highest price sensitivity to changes in interest rates? 1. 15 year zero coupon bond 2. 30 year 5% coupon bond 3. 30 year 10% coupon bond 4. 15 year 5% coupon bond 5. 30 year zero coupon bond

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Chapter12: Investing In Stocks And Bonds
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which of the following bond would have the highest price sensitivity to changes in interest rates?

1. 15 year zero coupon bond

2. 30 year 5% coupon bond

3. 30 year 10% coupon bond

4. 15 year 5% coupon bond

5. 30 year zero coupon bond 

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Step 1

Interest rate sensitivity is study as change in price or market value of bond due to unit change in interest rate.

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