Which of the Following Is an Implication of the Mean

question 15

Multiple Choice

Which of the following is an implication of the mean reversion of interest rates?

• A) Interest rates cannot become negative
• B) When short-term interest rates are high they tend to move down
• C) The term structure of interest rates tends to be upward sloping
• D) When short-term interest rates are low they tend to stay low

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