Deal of The Day! Hurry Up, Grab the Special Discount - Save 25% - Ends In 00:00:00 Coupon code: SAVE25
Welcome to Pass4Success

- Free Preparation Discussions
Mail Us support@pass4success.com
Location US
Mob_nav_barsMENU

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

Duration of a bond normally increases with an increase in:
A) time to maturity.
B) coupon rate.
C) yield to maturity.
D) par value.

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:

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

Limited Time Offer

25%

Off

Get Premium CFA-Level-I Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

0/2000 characters
Submit Cancel
Merilyn
9 months ago
Just to clarify, duration is all about interest rate sensitivity!
upvoted 0 times
...
Martha
9 months ago
Wait, are we sure about A? I thought yield to maturity played a bigger role.
upvoted 0 times
...
Edelmira
9 months ago
A makes sense, longer duration = more interest rate risk.
upvoted 0 times
...
Murray
10 months ago
I thought it was B, higher coupon rates mean more cash flow, right?
upvoted 0 times
...
Ahmed
10 months ago
Definitely A, time to maturity is key!
upvoted 0 times
...
Sue
10 months ago
I feel like par value doesn't really affect duration, but I'm not completely confident. It seems like a trick option.
upvoted 0 times
...
Aleta
10 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?
upvoted 0 times
...
Tawna
10 months ago
I'm not entirely sure, but I remember something about coupon rates affecting duration too. Maybe it's related?
upvoted 0 times
...
Denae
10 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.
upvoted 0 times
...
Adelle
10 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.
upvoted 0 times
...
Hyman
10 months ago
Okay, I've got this. Duration increases with time to maturity, so the answer must be A.
upvoted 0 times
...
Carmen
10 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.
upvoted 0 times
...
Tyra
11 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.
upvoted 0 times
...
Aleta
11 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.
upvoted 0 times
...
Jamal
11 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.
upvoted 0 times
...
Chery
11 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.
upvoted 0 times
...
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.
upvoted 0 times
Alberto
2 years ago
No problem! It's always good to learn more about different investment options.
upvoted 0 times
...
Armanda
2 years ago
I see, so it's not about keeping money safe. Thanks for the info!
upvoted 0 times
...
Johna
2 years ago
Yes, bonds are a way to invest money. But the duration actually increases with A) time to maturity.
upvoted 0 times
...
...
Cecilia
2 years ago
I think Mitsue is correct, as the yield to maturity affects the bond's price sensitivity to interest rate changes.
upvoted 0 times
...
Stephaine
2 years ago
Hmm, I think it's D) par value. Wait, what's a bond again?
upvoted 0 times
Lisbeth
2 years ago
Oh, I see. Thanks for clarifying!
upvoted 0 times
...
Justine
2 years ago
No, it actually increases with A) time to maturity.
upvoted 0 times
...
Alaine
2 years ago
A) time to maturity.
upvoted 0 times
...
...
Catalina
2 years ago
B) Coupon rate, no doubt. I've got this bond thing down.
upvoted 0 times
...
Donte
2 years ago
C) Yield to maturity seems like the correct answer. Gotta love those financial concepts!
upvoted 0 times
...
Sabrina
2 years ago
A) Time to maturity, of course! I learned that in my finance class.
upvoted 0 times
Alfreda
2 years ago
D) No, duration is mainly influenced by the time to maturity.
upvoted 0 times
...
Azalee
2 years ago
C) So, it's not affected by the coupon rate or yield to maturity?
upvoted 0 times
...
Franchesca
2 years ago
B) Yes, the longer the time to maturity, the longer the duration.
upvoted 0 times
...
Loren
2 years ago
A) Time to maturity, of course! I learned that in my finance class.
upvoted 0 times
...
...
Mitsue
2 years ago
C) yield to maturity.
upvoted 0 times
...
Galen
2 years ago
I agree with Louis, because the longer the time to maturity, the longer the bond's duration.
upvoted 0 times
...
Louis
2 years ago
A) time to maturity.
upvoted 0 times
...

Save Cancel