Because that type of bond is paying off most of the amount in future dollars. Since predictability decreases with incresed time and no initial cashflow makes the zero coupon bond very sensitive in the market.
Because the future cash flow (the repayment) for a long-term zero coupon bond is discounted over a longer period of time. This will result in a greater fluctuation in price market interest rates change.For example, assume bond A is a $100,000 zero coupon bond that matures in one year. Assume the bond is sold when market rates are 5%. This would mean that the bond price is about $95,238 (100,000/1.05). If, a few minutes after it was sold interest rates jumped to 10%, the bond price would fall to to $90,909 (100,000/1.10).Assume that bond B is a $100,000 zero coupon bond that matures in 10 years. Assuming the same rates above, the bond would have a selling price of $61,391 (100,000/(1.05)^10). However, when rates rise to 10%, the bond's price would plummet to $38,554 (100,000/(1.10)^10).Notice how much more sensitive the long-term bond is to changes in interest rates. Its price changes dramatically.