The Market Segmentation Theory Proposes That

Multiple Choice

The market segmentation theory proposes that:

A) the yield curve is upward sloping since lenders prefer shorter-term loans.
B) the debt market is represented by a single supply/demand diagram.
C) the debt market is represented by a series of supply/demand diagrams each representing a different term, and that these operate independently of one another.
D) the yield curve is inverted because lenders prefer longer-term loans at lower rates.