For an option-flee bond, if yields increase by 200 basis points, the parts of the total estimated percentage price change attributable to duration and the convexity adjustment, respectively, will most likely be:Part of the total estimated percentage price change attributable to duration Part of the total estimated percentage price change attributable to the convexity adjustment（）①A. Negative Positive ②B. Negative Negative ③C. Positive Positive
A. ①
B. ②
C. ③
参考答案：A
解析：
The total estimated price change for the bond is composed of the estimation based on the convexity. An option-free bond will exhibit positive convexity ( gains will be greater than losses given a change in yields) making the reduction price less than that implied by duration alone.