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Basic Question 0 of 2
Which of the following statements about the Macaulay duration of a zero-coupon bond is true? The Macaulay duration of a zero-coupon bond ______
B. is equal to the bond's maturity in years divided by its yield-to-maturity.
C. cannot be calculated because of the lack of coupons.
A. is equal to the bond's maturity in years.
B. is equal to the bond's maturity in years divided by its yield-to-maturity.
C. cannot be calculated because of the lack of coupons.
User Contributed Comments 6
| User | Comment |
|---|---|
| johntan1979 | To be more specific, it is actually Maturity x (1 + YTM/n) |
| Shaan23 | Now that question from the previous unit makes sense.... |
| janglejuic | to be perfectly clear, and to not create the confusion here I just really wanted to mention that this question and the answer A: is equal to the bond's maturity in years is absolutely correct. I just made you read this for no reason. |
| farhan92 | so Macaulay duration is average time to recover principal and coupon. We'd only recover it at maturity hence A is correct. |
| dbedford | If you go to investopedia and look up bond duration it has some good videos explaining this stuff |
| CFAJ | in b4 mark meldrum |
I am using your study notes and I know of at least 5 other friends of mine who used it and passed the exam last Dec. Keep up your great work!
Barnes
Learning Outcome Statements
demonstrate the application of the Code of Ethics and Standards of Professional Conduct to situations involving issues of professional integrity
recommend practices and procedures designed to prevent violations of the Code of Ethics and Standards of Professional Conduct
identify conduct that conforms to the Code and Standards and conduct that violates the Code and Standards
CFA® 2025 Level I Curriculum, Volume 6, Module 3.