Kingston Manufacturing has 27,000 labor hours available for producing X and Y. Consider the following information: Product X Pro
duct Y Required labor time per unit (hours) 2 3 Maximum demand (units) 6,000 8,000 Contribution margin per unit $ 5 $ 6 Contribution margin per labor hour $ 2.50 $ 2 If Kingston follows proper managerial accounting practices, how many units of Product Y should it produce
Explanation It is a common fact that bonds having longer term maturities have higher interest rate risk as compared to the bonds having short term maturities.
This, is due to the fact that market yield and price of bond have inverse relationship. Thus, the bonds having longer term periods to maturity will face more interest rate fluctuations as compared to short term bonds, that's why long term bonds price is more sensitive to interest rate changes.