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CFA Institute CFA-Level-I Exam - Topic 2 Question 3 Discussion

Actual exam question for CFA Institute's CFA-Level-I exam
Question #: 3
Topic #: 2
[All CFA-Level-I Questions]

Duration of a bond normally increases with an increase in:

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Suggested Answer: A
by Luis at Sep 12, 2024, 10:16 AM

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Merilyn
4 months ago
Just to clarify, duration is all about interest rate sensitivity!
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Martha
4 months ago
Wait, are we sure about A? I thought yield to maturity played a bigger role.
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Edelmira
5 months ago
A makes sense, longer duration = more interest rate risk.
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Murray
5 months ago
I thought it was B, higher coupon rates mean more cash flow, right?
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Ahmed
5 months ago
Definitely A, time to maturity is key!
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Sue
5 months ago
I feel like par value doesn't really affect duration, but I'm not completely confident. It seems like a trick option.
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Aleta
6 months ago
I practiced a question similar to this, and I think it was about how yield to maturity impacts duration. Could that be the answer?
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Tawna
6 months ago
I'm not entirely sure, but I remember something about coupon rates affecting duration too. Maybe it's related?
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Denae
6 months ago
I think the duration of a bond increases with the time to maturity, right? That seems to be a key concept we covered.
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Adelle
6 months ago
Wait, I thought duration was also affected by the coupon rate and yield to maturity. I better review my notes before answering this one.
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Hyman
6 months ago
Okay, I've got this. Duration increases with time to maturity, so the answer must be A.
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Carmen
6 months ago
Hmm, I'm a bit unsure about this one. I know duration is related to bond maturity, but I'm not sure how the other factors like coupon rate and yield to maturity come into play.
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Tyra
6 months ago
This seems like a straightforward question on bond duration. I'll think through the factors that affect bond duration and choose the best answer.
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Aleta
6 months ago
I'm confident the answer is A. Duration is directly proportional to time to maturity, so an increase in maturity will increase the duration.
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Jamal
6 months ago
Okay, I've reviewed the GDPR guidelines, and I believe the answer is B. Processing the data is necessary for the tax advisor to comply with their legal obligations.
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Chery
6 months ago
I think the answer is A. Workforce Manager would automatically append a number in sequence to the duplicate scenario name to avoid conflicts.
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Florinda
2 years ago
Bonds? Aren't those those things you buy to keep your money safe? I'm going with C) just to be safe.
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Alberto
1 year ago
No problem! It's always good to learn more about different investment options.
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Armanda
1 year ago
I see, so it's not about keeping money safe. Thanks for the info!
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Johna
1 year ago
Yes, bonds are a way to invest money. But the duration actually increases with A) time to maturity.
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Cecilia
2 years ago
I think Mitsue is correct, as the yield to maturity affects the bond's price sensitivity to interest rate changes.
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Stephaine
2 years ago
Hmm, I think it's D) par value. Wait, what's a bond again?
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Lisbeth
2 years ago
Oh, I see. Thanks for clarifying!
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Justine
2 years ago
No, it actually increases with A) time to maturity.
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Alaine
2 years ago
A) time to maturity.
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Catalina
2 years ago
B) Coupon rate, no doubt. I've got this bond thing down.
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Donte
2 years ago
C) Yield to maturity seems like the correct answer. Gotta love those financial concepts!
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Sabrina
2 years ago
A) Time to maturity, of course! I learned that in my finance class.
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Alfreda
1 year ago
D) No, duration is mainly influenced by the time to maturity.
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Azalee
2 years ago
C) So, it's not affected by the coupon rate or yield to maturity?
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Franchesca
2 years ago
B) Yes, the longer the time to maturity, the longer the duration.
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Loren
2 years ago
A) Time to maturity, of course! I learned that in my finance class.
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Mitsue
2 years ago
C) yield to maturity.
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Galen
2 years ago
I agree with Louis, because the longer the time to maturity, the longer the bond's duration.
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Louis
2 years ago
A) time to maturity.
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