Which of the Following Statements Is FALSE

question 44

Multiple Choice

Which of the following statements is FALSE?

• A)An inverted yield curve generally signals an expected decline in future interest rates.
• B)An inverted yield curve is often interpreted as a positive forecast for economic growth.
• C)All the formulas for computing present values of annuities and perpetuities are based upon discounting all of the cash flows at the same rate.
• D)The rate of growth of your purchasing power is determined by the real interest rate.

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Definitions:

Fixed Coupon

A bond or debt security that pays a specified rate of interest throughout its entire term.

Maturity

The state of being fully developed in the body or the mind, or the point at which an instrument of credit becomes due.

Mainstream Venture Capitalists

Investors that focus on providing capital to firms considered to have high growth potential in well-established markets.

Management

The process of administering and coordinating resources efficiently and effectively in achieving predetermined objectives.