Consider Example 18-11 and Table 18-1.Let's say the price is $950.00 rather $974.17 (so the YTM goes to 6.1% from 5.6%).What happens to duration?
A)It increases substantially.
B)It increases only a little amount.
C)It decreases substantially.
D)It decreases only a little amount

Question

Quizplus · Accepted Answer

Duration decreases only a little amount because as the yield to maturity (YTM) increases, the bond's duration typically decreases, but the change is not substantial for small changes in YTM.