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Which of the Following Is True of PV01

Question 10

Multiple Choice

Which of the following is true of PV01?


A) In a corporate setting,firms that have low PV01s are more exposed to interest rate risk.
B) High-PV01 bonds are more sensitive to interest rate movements than low-PV01 bonds.
C) Low-PV01 bonds are more volatile to interest rate movements than high-PV01 bonds.
D) If a corporation has a stock that has a positive PV01,then acquiring a bond with a positive PV01 will increase the interest rate exposure.

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