The Market Segmentation Theory Holds That

question 21

Multiple Choice

The market segmentation theory holds that

• A) an increase in demand for long- term borrowings leads to an inverted yield curve.
• B) the yield curve reflects the maturity preferences of financial institutions and investors.
• C) expectations about the future level of interest rates is the major determinant of the shape of the yield curve.
• D) the shape of the yield curve is always downsloping.

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Definitions:

Economic Independence

The state of having sufficient personal wealth to live, without having to work actively for basic necessities, allowing an individual financial freedom.

Antislavery Sentiment

The attitude, movement, or ideology opposing slavery, advocating for its abolition, and supporting freedom for enslaved people.

Abolitionist Ranks

Individuals and groups actively involved in the movement to end slavery and the slave trade throughout the 18th and 19th centuries.

Kansas-Nebraska Act

1854 law sponsored by Illinois senator Stephen A. Douglas to allow settlers in newly organized territories north of the Missouri border to decide the slavery issue for themselves; fury over the resulting repeal of the Missouri Compromise of 1820 led to violence in Kansas and to the formation of the Republican Party.