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Question:

Other things equal, an increase in an option-free bond’s yield to maturity will:

A decrease its interest rate risk.
explanation

Because the price-yield relationship for an option-free bond is convex, interest rate risk as measured by duration changes when a bond s YTM changes. An increase in YTM reaches a flatter part of the price-yield curve, from which changes in yield will have relatively smaller effects on the bonds value.

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