The expectations hypothesis assumes each of the following, except:
A. bonds of different maturities are perfect substitutes.
B. bonds of different maturities are not perfect substitutes.
C. bonds of different maturities have the same risk characteristics.
D. long-term bond rates are equal to the average of current and expected future short-term interest rates.
Answer: B
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Which of the following is not an example of price discrimination by a firm?
a. children's meals at a restaurant b. a natural gas company charging customers a higher rate in the winter than in the summer c. a senior citizens' discount d. coupons in the Sunday newspaper
If an economy can produce various combinations of food and shelter along a production possibilities curve (PPC), then if we increase the production of shelter along the PPC, which of the following is true?
a. We cannot change the production of food. b. We must decrease the production of food. This forgone food production represents the opportunity cost of the increase in shelter. c. We also increase the production of food. d. The concept of opportunity cost does not apply along PPC.
Simple regression is an analysis of correlation between two variables.?
Answer the following statement true (T) or false (F)
The fact that snow cones sales fall when snow accumulated from the sky suggests that snow cones sales and snow on the ground are
A. both directly correlated and inversely correlated. B. neither directly correlated nor inversely correlated. C. directly correlated. D. inversely correlated.