Explanation:
Correct answer: D
A floating-rate bond generally has low duration, not higher duration, because its coupon resets periodically to market rates. Its duration is approximately the time until the next coupon reset/payment, and in practice is often close to zero.
Hence, the exception is D.
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Q-195.3. Each of the following is true about corporate bond interest payments EXCEPT:
A
The three main interest payment classifications of domestically issued corporate bonds are straight-coupon bonds (aka, fixed-rate), zero-coupon bonds, and floating-rate (aka, variable-rate) bonds
B
Two variations on the zero-coupon bond are deferred-interest bonds (DIB) and pay-in-kind (PIK) bonds
C
The day count convention (a.k.a.) day count basis for corporate bonds issued in the United States is 30/360
D
A floating-rate bond tends to have a higher duration than a straight-coupon bond with an equivalent current yield