According to the Segmented Markets Hypothesis, Interest Rates Are Determined

question 53

Multiple Choice

According to the segmented markets hypothesis, interest rates are determined by _____________________.

• A)supply and demand factors in various separate markets of different terms to maturity.
• B)the expectations theory modified by preferred habitats theory.
• C)a small segment of the most influential borrowers and lenders in the market.
• D)None of the above are correct.

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Definitions:

Contract

A legally enforceable agreement between two or more parties that creates mutual obligations enforceable by law.

Gratuitous Bailment

A bailment where the bailee holds the bailed property without receiving compensation, doing it for the bailor's benefit only.

Legal Obligation

A duty enforced by law, requiring an entity or individual to follow or abstain from specific actions, subject to legal consequences for failure to comply.

Lawnmower

A machine equipped with revolving blades or a blade bar for cutting grass to an even length.