Rank the following bonds, from highest to lowest interest rate risk: 2-year zero coupon, 2-year 5 percent coupon bond, 30-year 5 percent coupon bond, 30-year, zero coupon bond.
A. 30-year, zero coupon bond, 30-year 5 percent coupon bond, 2-year zero coupon bond, 2-year 5 percent coupon bond
B. 30-year, 5 percent coupon bond, 30-year zero coupon bond, 2-year 5 percent coupon bond, 2-year zero coupon bond
C. 2-year 5 percent coupon bond, 2-year zero coupon bond, 30-year 5 percent coupon bond, 30-year zero coupon bond
D. 30-year, zero coupon bond, 30-year 5 percent coupon bond, 2-year 5 percent coupon bond, 2-year zero coupon bond
Answer: A
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