If an Investor Has a Six-Month Investment Horizon, Buying a 5-Year

Multiple Choice

If an investor has a six-month investment horizon, buying a 5-year, 10-year, or 20-year bond will produce the same six-month return. This interpretation of the pure expectations theory is referred to as the:

A) Return-to-maturity expectation.
B) Local expectations.
C) Broadest interpretation.
D) Liquidity theory.
E) None of the above.