If Intermediate-Term, Default-Free, Pure Discount Bonds Have a Higher Rate

question 41

Multiple Choice

If intermediate-term, default-free, pure discount bonds have a higher rate of return than either the comparable shorter-term or longer-term bonds, the term structure of interest rates will be:

• A)upward sloping.
• B)flat.
• C)humped.
• D)downward sloping.
• E)double-humped.

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