Vidyalelo
Management · Q646

International Finance and Treasury

Graduate and Post Graduate · Management · question 646

Q646

Change in interest rate measured in percentage for given interest rate change is classified as

A.
premium yield
B.
elasticity
Answer
C.
duration
D.
maturity yield

Answer: Option B

Solution

Answer: Option B
Solution:
Change in interest rate measured in percentage for given interest rate change is classified as elasticity. Elasticity is a measure of a variable's sensitivity to a change in another variable. In business and economics, elasticity refers the degree to which individuals, consumers or producers change their demand or the amount supplied in response to price or income changes.