a.
To determine: Rank the effective durations of the bond.
Introduction: The call feature on a bond provides the right to thebond issuers to force the bondholders to call back in their bonds for fixed income, the call price. Call features are widely used for protection against a drop in interest rates. So, before buying the bond, it is important to know the call features, when transacting the bond.
b.
To determine: Rank the effective durations of the bond.
Introduction: The call feature on a bond provides the right to bond issuers to force the bondholders to call back in their bonds for fixed income, the call price. Call features are widely used for protection against a drop in interest rates. So, before buying the bond, it is important to know the call features, when transacting the bond.
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