Question

What is advisable when investing in longer-duration bonds in the context of interest-rate expectations?

a.

Invest in longer-duration bonds when rates are expected to rise

b.

Avoid longer-duration bonds when rates are expected to rise

c.

Longer-duration bonds are always a safe investment

d.

The impact of interest-rate changes is the same for all bond durations

Answer: (a).Invest in longer-duration bonds when rates are expected to rise Explanation:It is advisable to invest in longer-duration bonds when interest rates are expected to fall and avoid them when rates are expected to rise.

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Q. What is advisable when investing in longer-duration bonds in the context of interest-rate expectations?

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