menu-iconExamlexExamLexServices

Discover

Ask a Question
  1. All Topics
  2. Topic
    Business
  3. Study Set
    Money Banking
  4. Exam
    Exam 5: The Risk Structure and Term Structure of Interest Rates
  5. Question
    The Investment Strategy of Borrowing at a Low Short-Term Interest
Solved

The Investment Strategy of Borrowing at a Low Short-Term Interest

Question 17

Question 17

Multiple Choice

The investment strategy of borrowing at a low short-term interest rate and using the borrowed funds to invest at a higher long-term interest rate is called


A) arbitrage.
B) interest carry trade.
C) risk structure.
D) liquidity premium.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Q13: In late 2008,the average risk premium rose

Q14: In 2016,as investors became more concerned with

Q15: The liquidity premium theory holds that investors<br>A)

Q18: What is a primary reason for the

Q21: Which of the following statements about junk

Q22: Which of the following is a single

Q32: Many savers are willing to accept a

Q71: U.S. Treasury securities<br>A)are considered risk free because

Q78: The default risk premium fluctuates mainly<br>A)because bond

Q79: Under the expectations theory, an upward-sloping yield

Examlex

ExamLex

About UsContact UsPerks CenterHomeschoolingTest Prep

Work With Us

Campus RepresentativeInfluencers

Links

FaqPricingChrome Extension

Download The App

Get App StoreGet Google Play

Policies

Privacy PolicyTerms of ServiceHonor CodeCommunity Guidelines

Scan To Download

qr-code

Copyright © (2025) ExamLex LLC.

Privacy PolicyTerms Of ServiceHonor CodeCommunity Guidelines