If 1-Year Interest Rates for the Next Three Years Are

question 36

Multiple Choice

If 1-year interest rates for the next three years are expected to be 1,1,and 1 percent,and the 3-year term premium is 1 percent,than the 3-year bond rate will be

• A)1 percent.
• B)2 percent.
• C)3 percent.
• D)4 percent.

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Definitions:

Negative Thinking And Biases

Patterns of thought that involve pessimistic perceptions, expectations, or interpretations of oneself, others, and the world.

Challenge Automatic Thoughts

In cognitive therapy, this involves questioning and testing the reality of negative thoughts and assumptions.

Black-and-white Terms

Describing situations or thinking in absolute terms, without acknowledging the complexities or grey areas that may exist.

Automatic Thoughts

Numerous unpleasant thoughts that help to cause or maintain depression, anxiety, or other forms of psychological dysfunction.