In capital budgeting, term of bond which has great sensitivity to interest rates is
- long-term bonds
- short-term bonds
- internal term bonds
- external term bonds
Explanation
In capital budgeting, term of bond which has great sensitivity to interest rates is long-term bonds. Bond with a maturity period of more than 15 years. Long bonds pay higher interest rates but have greater credit and inflation risk. Also called long bond.
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