According to Segmented Markets Theory, If Investors Have Mostly Short-Term

question 22

Multiple Choice

According to segmented markets theory, if investors have mostly short-term funds available and borrowers want long-term funds, there would be ____ pressure on the supply of short-term funds provided by investors and ____ pressure on the yield of long-term securities.

• A)upward; upward
• B)downward; downward
• C)upward; downward
• D)downward; upward

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Definitions:

Profit-Maximizing

A strategy or point at which a business makes the highest profit possible, given its production costs and market demand.

Total Revenue

The entire amount of income generated by the sale of goods or services by a company before any expenses are deducted.

Fixed Costs

Costs that do not vary with the level of production or sales, such as rent, salaries, and insurance premiums.

Variable Costs

Costs that change in proportion to the level of goods or services that a business produces.