If Interest Rates Move Lower After a Treasury Note Is

question 105

Multiple Choice

If interest rates move lower after a Treasury note is issued,a holder selling it into the secondary markets:

• A) receives a capital gain.
• B) receives a capital loss.
• C) receives the original price, as short-term markets are not so affected by interest rate movements.
• D) receives a higher yield owing to the time elapsed.

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Definitions:

Workforce Reduction

A short-term strategy to cut the number of employees through attrition, early retirement or voluntary severance packages, and layoffs or terminations.

Attrition

The gradual reduction in workforce numbers due to employees leaving naturally through resignation, retirement, or death, without intending to directly replace them.

Early Retirement

The act of leaving one's job or career before the traditional retirement age, often incentivized by employers or chosen for personal or health reasons.

Layoffs

The act of terminating employees, often due to economic downturns, organizational restructuring, or cost-cutting measures.