Which of the Following Statement Completions Is Correct? If the Yield

question 46

Multiple Choice

Which of the following statement completions is correct? If the yield curve is upward sloping, then a firm's marketable securities portfolio, assumed to be held for liquidity purposes, should be

• A) Weighted toward long-term securities because they pay higher rates.
• B) Weighted toward short-term securities because they pay higher rates.
• C) Weighted toward S.A.Treasury securities to avoid interest rate risk.
• D) Weighted toward short-term securities to avoid interest rate risk.
• E) Balanced between long- and short-term securities to minimise the effects of either an upward or a downward trend in interest rates.

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Definitions:

Jewelry

Decorative items worn for personal adornment, such as rings, necklaces, and bracelets, often made from precious metals and stones.

RAM

Random Access Memory, a form of computer memory that can be accessed randomly and is used for storing operating system, application programs, and currently processed data.

Intermittent

Intermittent refers to events or processes that are not continuous but occur at irregular intervals.

Reboot

A restart of an operating system, also known as a warm start.