Identify a Major Reason Behind the Increase in Domestic Underwriting

question 31

Multiple Choice

Identify a major reason behind the increase in domestic underwriting activity during the 1990s.

• A)Enhanced non-trading profits.
• B)High long-term interest rates.
• C)Low long-term dividend rates.
• D)Growth in the asset-backed securities market.
• E)Decreased securitization of debt.

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Definitions:

Historical Annual Average

An average value calculated from a series of yearly figures, often used in financial analysis to smooth out fluctuations.

Holding-Period Return

Holding-period return is the total return received from holding an asset or portfolio of assets over a specified period, including interest, dividends, and capital gains.

Dividend

A portion of a company's earnings that is distributed to shareholders, usually in the form of cash or additional shares.

Effective Annual Rate

The actual interest rate an investor receives or pays in a year, taking into account the effect of compounding.