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If I read Question 137 of exam I, I am confused about question 137. For me answer IV is true and therefore correct. If I read the solution it states that it is incorrect. Could you help me on this?
Regards,
Question 137:
Which of the following statements are true?
IV. Convexity is higher for a bond with a lower coupon when compared to a similar bond with a higher coupon.
Therefore Convexity is higher for a bond with a lower coupon when compared to a similar bond with a higher coupon. Statement IV is not correct.
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