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The Increase in Yield Spreads in Late 2008 and Early

Question 68

Multiple Choice

The increase in yield spreads in late 2008 and early 2009 indicated that


A) Credit risk premiums decreased
B) Market risk premiums increased
C) Investors are more confident of the future cash flows of bonds
D) Non-investment grade bonds are less risky
E) Government bonds are no longer a risk free investment

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