Which One of the Following Statements Is False Concerning the Term

question 2

Multiple Choice

Which one of the following statements is false concerning the term structure of interest rates?

• A) Expectations of lower inflation rates in the future tend to lower the slope of the term structure of interest rates.
• B) The term structure of interest rates includes both an inflation premium and an interest rate risk premium.
• C) The term structure of interest rates and the time to maturity are always directly related.
• D) The real rate of return has minimal, if any, effect on the slope of the term structure of interest rates.
• E) The interest rate risk premium increases as the time to maturity increases.

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Fibrocystic Disease

A common and generally harmless breast condition in which fibrous tissue and benign cysts develop in the breast.

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A form of cancer that develops from breast tissue, characterized by the growth of malignant cells in the breast.

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