When comparing a 10-year bond versus a 1-year bond, the 10-year bond has a much greater interest rate risk. The given statement is true.
<h3>What is 10-year bond versus?</h3>
The 10-year yield stands used as a proxy for mortgage rates. It's also seen as a symbol of investor sentiment about the economy. A rising yield indicates declining demand for Treasury bonds, which represents investors prefer higher-risk, higher-reward investments. A falling yield indicates the opposite.
When the 10-year yield proceeds up, so do mortgage rates and other borrowing rates. When the 10-year yield downfalls and mortgage rates fall, the housing market maintains, which in turn has a positive impact on economic development and the economy.
Put another way, present value captures how much would require to be invested today to maintain some amount at a provided point in the future if one could earn a specific return. When comparing a 10-year bond versus a 1-year bond, the 10-year bond has a much greater interest rate risk.
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