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PRMIA Exam 8006 Topic 3 Question 67 Discussion
Actual exam question for
PRMIA's
8006 exam
Question #: 67
Topic #: 3
[All 8006 Questions]
Topic #: 3
Which of the following will have the effect of increasing the duration of a bond, all else remaining equal:
1. Increase in bond coupon
II. Increase in bond yield
III. Decrease in coupon frequency
IV. Increase in bond maturity
Suggested Answer:
A
Over the counter and electronic communication networks match buyers and sellers. However, there is no market making function, ie, in periods of stress liquidity may completely disappear from these markets. Exchanges normally have market makers that are required to present two way quotes on the securities they are making the market for. Therefore Choice 'a' is the correct answer.
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