The risk structure of interest rates refers to the:
A. additional interest required to compensate the buyer for the longer maturity of the bond.
B. relationship among the interest rates of bonds with different maturities.
C. relationship among the interest rates of bonds from different issuers with the same maturities.
D. relationship among the interest rates of bonds from the same issuer but different maturities.
Answer: C
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An import quota protects domestic producers by
A) setting a limit on the amount of imports. B) placing a prohibitive tax on imports. C) encouraging competition among domestic producers. D) increasing the total supply of the product.
In the short-run, any rise in the real exchange rate, EP /P, will cause
A) an upward shift in the aggregate demand function and a reduction in output. B) an upward shift in the aggregate demand function and an expansion of output. C) a downward shift in the aggregate demand function and an expansion of output. D) an downward shift in the aggregate demand function and a reduction in output. E) an upward shift in the aggregate demand function but leaves output intact.
One of the sources of error in the RMSFE in the AR(1) model is
A) the error in estimating the coefficients ?0 and ?1. B) due to measuring variables in logarithms. C) that the value of the explanatory variable is not known with certainty when making a forecast. D) the model only looks at the previous period's value of Y when the entire history should be taken into account.
Which of the following would not be included in the gross private domestic investment (I) category of GDP?
a. A bakery's purchase of a new oven. b. A retailer's additions to its inventories. c. Newly built residential construction. d. A bank's purchase of a U.S. Treasury bond.