Multiple Choice
According to the liquidity premium theory,the yield curve normally has a positive slope because
A) short-term interest rates are expected to rise.
B) term premiums rise as the time to maturity increases.
C) risk premiums rise over time.
D) long-term bonds are more liquid than short-term bonds.
Correct Answer:

Verified
Correct Answer:
Verified
Q18: What is a primary reason for the
Q21: Which of the following statements about junk
Q22: Which of the following is a single
Q24: For the average individual investor,the gap between
Q25: Interest and capital gains are taxed differently
Q26: In which of the following periods was
Q27: If a one-year bond currently yields 5%
Q28: In which of the following situations would
Q71: U.S. Treasury securities<br>A)are considered risk free because
Q78: The default risk premium fluctuates mainly<br>A)because bond