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

question 104

Multiple Choice

If 1-year interest rates for the next five years are expected to be 4,2,5,4,and 5 percent,and the 5-year term premium is 1 percent,than the 5-year bond rate will be

• A)2 percent.
• B)3 percent.
• C)4 percent.
• D)5 percent.

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Definitions:

Global Market Entry Strategy

A planned method of delivering goods or services to a new target market and establishing a presence in a foreign country.

International Sales

The practice of selling products or services beyond a company's domestic borders, into foreign markets.

Joint Venture

A business arrangement where two or more parties agree to pool their resources for the purpose of accomplishing a specific task.

Telecommunications Firm

A company that provides services in telecommunications, such as phone services, internet access, and cable TV.