Signs That An Oil Pump Needs Replacing The engine of an automobile relies on many parts functioning properly. It should be no surprise that if one becomes deficient; it is going to cause a great deal of wear on the engine itself.
Macaulay duration is a time measure with units in years, and really makes sense only for an instrument with fixed cash flows. For a standard bond the Macaulay duration will be between 0 and the maturity of the bond. It is equal to the maturity if and only if the bond is a zero-coupon bond.
What is 'Duration'. Duration is a measure of the sensitivity of the price -- the value of principal -- of a fixed-income investment to a change in interest rates. Duration is expressed as a number of years. Bond prices are said to have an inverse relationship with interest rates.