When the Russian Government Defaulted on Its Bonds in August

question 49

Multiple Choice

When the Russian government defaulted on its bonds in August 1998:

• A) risk spreads decreased significantly.
• B) yields on U.S. Treasury securities fell while yields on corporate bonds rose.
• C) yields on U.S. Treasury securities rose while prices of corporate bonds rose.
• D) risk spreads did not change.

---

Definitions:

Confidence

The belief in one's abilities or qualities and the assurance in the trustworthiness or success of something or someone.

Self-Efficacy

A person’s belief that she or he is capable of performing a task.

Motivation

The process by which a person’s desires and values influence his or her behavior.

Self-Efficacy Theory

A concept in psychology that refers to an individual's belief in their capacity to execute behaviors necessary to produce specific performance attainments.