The Yield Curve

question 51

Multiple Choice

The yield curve

• A)is a graphical depiction of term structure of interest rates.
• B)is usually depicted for U.S.Treasuries in order to hold risk constant across maturities and yields.
• C)is usually depicted for corporate bonds of different ratings.
• D)is a graphical depiction of term structure of interest rates and is usually depicted for U.S.Treasuries in order to hold risk constant across maturities and yields.

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Definitions:

Normal Return

The minimum profit needed for a company to remain competitive in the market, covering its opportunity costs.

Government Regulates

The process by which governments impose rules and directives to govern the operation of markets and industries, often to protect consumers and maintain fair competition.

Barrier To Entry

Barriers to entry are obstacles or impediments that make it difficult for new entrants to enter a particular market, such as high start-up costs, strict regulations, or strong brand loyalty among consumers.

Economies Of Scale

Economies of scale are cost advantages reaped by companies when production becomes efficient, as the cost per unit of output decreases with the increase in scale of operation.