According to the Segmented Markets Theory, If Most Investors Suddenly

question 13

Multiple Choice

According to the segmented markets theory, if most investors suddenly preferred to invest in short-term securities and most borrowers suddenly preferred to issue long-term securities, there would be

• A)upward pressure on the yields of both short-term and long-term securities .
• B)downward pressure on the yield of short-term securities .
• C)downward pressure on the yield of long-term securities.
• D)upward pressure on the yield of short-term securities .

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Definitions:

Stock Exchanges

Marketplaces where securities, such as stocks and bonds, are bought and sold by participants.