When There Is an Upward Sloping Yield Curve and Interest

question 83

Multiple Choice

When there is an upward sloping yield curve and interest rates are forecast to increase a firm decides to restructure its outstanding debt to longer term then in the short-term the company:

• A) faces an immediate decrease in its costs of funds.
• B) faces an immediate increase in its costs of funds.
• C) is reducing its basis risk.
• D) is reducing its business risk.

---

Definitions:

Near Wins

Events that closely approach success but ultimately result in failure, often influencing future behavior and motivation.

Par For The Course

A phrase indicating that a certain situation or behavior is what one might expect to happen in the given context; typical or normal.

Mere Exposure Effect

A mental effect in which individuals grow fond of entities simply due to their acquaintance with them.

Nonconscious Level

Refers to mental processes that occur outside of conscious awareness, influencing perceptions, thoughts, and actions without an individual's conscious recognition.