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:

Indian Scalps

Refers to the practice of removing the scalp of Native Americans, often used historically as a trophy of war or proof of kill for bounty payments.

Trade

The action of buying, selling, or exchanging goods and services between people, states, or countries.

Small Households

Living arrangements involving fewer individuals, often reflecting changes in society such as increased individualism or declining family sizes.

Slaves

Individuals forced into servitude, deprived of personal freedom and the right to make their own life choices, often under harsh conditions.