Question
Which of the following statement completions is CORRECT? If the yield curve is upward sloping, then the marketable securities held in a firm's portfolio, assumed
Which of the following statement completions is CORRECT? If the yield curve is upward sloping, then the marketable securities held in a firm's portfolio, assumed to be held for emergencies, should
A. | consist mainly of long-term securities because they pay higher rates. | |
b. | consist mainly of short-term securities because they pay higher rates. | |
c. | consist mainly of U.S. Treasury securities to minimize interest rate risk. | |
d. | consist mainly of short-term securities to minimize interest rate risk. | |
e. | be balanced between long- and short-term securities to minimize the adverse effects of either an upward or a downward trend in interest rates. |
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