When the Term Structure of Interest Rates Is Downward Sloping

question 78

Multiple Choice

When the term structure of interest rates is downward sloping and interest rates are expected to decline,the:

• A) financial manager generally borrows short-term.
• B) financial manager borrows at the lower long-term rates.
• C) corporation's ratio of short-term to long-term debt is low.
• D) financial managers view short-term rates as high risk.

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