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The Following Table Shows Information About Bonds Issued by Governments

question 77

Essay

The following table shows information about bonds issued by governments and companies in Canada, sorted by increasing maturity. (Source: Globe and Mail, retrieved 12 August, 2010, http://www.globeinvestor.com/servlet/Page/document/v5/data/bonds/.) Does this information support the theory that less risky bonds yield lower returns
Explain your answer.
The following table shows information about bonds issued by governments and companies in Canada, sorted by increasing maturity. (Source: Globe and Mail, retrieved 12 August, 2010, http://www.globeinvestor.com/servlet/Page/document/v5/data/bonds/.) Does this information support the theory that less risky bonds yield lower returns  Explain your answer.


Definitions:

Unit Elastic

A situation in economics where the percentage change in quantity demanded is equal to the percentage change in price, resulting in no change in total revenue.

Total Revenue

The overall financial returns a corporation secures by selling products and providing services across a certain interval.

Very Elastic

Very elastic describes demand that significantly changes in response to small changes in price, indicating high sensitivity of consumers.

Total Revenue

The sum of all payments received by a company for its products or services, not accounting for any expenses.

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