The Default-Risk Premium

question 91

Multiple Choice

The default-risk premium:

• A) should vary directly with the bond's yield and inversely with its price.
• B) is less than 0 (zero) for a U.S. Treasury bond.
• C) should be lower for a highly speculative bond than for an investment-grade bond.
• D) should vary directly with the bond's yield and the bond's price.

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Definitions:

Causal Attribution

The process by which individuals explain the causes of behavior and events, attributing them to internal dispositions or external situations.

Enculturation

The process by which individuals learn the dynamics of their surrounding culture and acquire values and norms appropriate or necessary in that culture.

Platinum Rule

Guiding principle that encourages treating others the way they want to be treated, reflecting empathy and understanding of personal preferences.

Milton Bennett

A scholar known for his work on intercultural sensitivity and the Developmental Model of Intercultural Sensitivity.