Financial Instruments with High Interest Rates Due to Higher Information

question 46

Multiple Choice

Financial instruments with high interest rates due to higher information costs

• A)tend to have less risk than similar financial instruments with low information costs.
• B)also tend to be relatively illiquid.
• C)also tend to have higher prices than similar financial instruments with low information costs.
• D)are usually heavily traded, which serves to partially offset their having high information costs.

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Definitions:

Economic Trends

Patterns or tendencies in the economy that indicate the direction of the overall economic activities and conditions.

Psychiatry

A branch of medicine focused on the diagnosis, treatment, and prevention of mental, emotional, and behavioral disorders.

Psychiatric Diagnoses

The process of identifying and categorizing mental health disorders based on symptomatology and clinical criteria.

Psychological Disorders

Mental disorders characterized by patterns of behavior or thought that are both distressing and deviate from societal norms.