The Problem in Stretching Out the Maturity of Marketable Securities

question 38

Multiple Choice

The problem in stretching out the maturity of marketable securities is that

• A) you are legally locked in until the maturity date.
• B) longer term securities are often not available.
• C) there is greater possibility of loss.
• D) interest rates are generally lower.

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Definitions:

Chocolate Factory

A facility where chocolate is produced, ranging from the processing of cocoa beans to the making of chocolate products.

Flood

An overflow of water that submerges land which is usually dry, often caused by heavy rainfall, river overflow, or other environmental conditions.

Insurance

A financial product or arrangement whereby a company provides compensation or coverage against possible future losses or risks in exchange for a premium.

Wealth

The total value of all financial and non-financial assets owned by an individual, company, sector, or nation minus any liabilities.