Other things the same, as the maturity length of a bond becomes longer, the bond will...
Other things the same, as the maturity length of a bond becomes longer, the bond will pay
more interest because it has more risk
less interest because it has less risk
less interest because it has more risk
more interest because it has less risk
Homework Answers
ANSWER:
The correct answer is option a that is more interest because it has more risk as over the period of time , a factor of uncertainty arises due to which the risk is more and with more risk rewards increases and so the higher interest rate.
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