a limitation of calculating a bond portfolio's duration as the weighted average of the yield durations of the individual bonds that compose the portfolio is that it:
A) assumes a parallel shift to the yield curve.
B) is less accurate when the yield curve is less steeply sloped.
C) is not applicable to portfolios that have bonds with embedded options.

Question

Quizplus · Accepted Answer

Assumes a parallel shift to the yield curve.

A Limitation of Calculating a Bond Portfolio's Duration as the Weighted