The duration of a 5-year zero-coupon bond is
A) smaller than 5.
B) larger than 5.
C) equal to 5.
D) equal to that of a 5-year 10% coupon bond
E) none of these.

Name: The duration of a 5-year zero-coupon bond is A) smaller than 5. B) larger than 5. C) equal to 5. D) equal to that of a 5-year 10% coupon bond E) none of these.
Brand: Quizplus
Rating: 4.8 (37 reviews)

Question

Quizplus · Accepted Answer

The duration of a zero-coupon bond is equal to its maturity because it pays no coupons, so all cash flows are received at maturity.

The Duration of a 5-Year Zero-Coupon Bond Is