Question
If the yield curve is downward sloping, which of the following statements is correct? (hint: graph the yield curves for a T-bond, a AAA bond,
If the yield curve is downward sloping, which of the following statements is correct? (hint: graph the yield curves for a T-bond, a AAA bond, and a B bond)
Select one:
a.The yield on the 5-year T-bond must exceed the yield on the 5-year AAA corporate bond.
b.The yield on the 10-year T-bond must be less than the yield on a 2-year T-bond.
c.The yield on the 5-year AAA corporate bond must be lower the yield on the 5-year T-bond.
d.The yield on the 5-year AAA corporate bond must exceed the yield on 5-year B corporate bond.
e.The yield on the 5-year T-bond must exceed the yield on the 10-year AAA corporate bond.
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