Bonds Perceived as High Risk Typically Pay ________ Interest Rates

question 129

Multiple Choice

Bonds perceived as high risk typically pay ________ interest rates.

• A) higher
• B) lower
• C) more volatile
• D) less volatile

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Definitions:

Stable

Characterized by consistency, permanence, and resistance to change over time.

Unstable

Characterizes a state or condition that lacks consistency, predictability, or emotional steadiness.

Belief Perseverance

A tendency to continue to view an initial assumption as correct despite evidence to the contradictory.

Self-serving Bias

In attribution, the tendency for people to take personal credit for acts that yield positive outcomes and to deflect blame for bad outcomes by attributing them to external causes.