Short-Term Interest Rates Have _________ Volatility in Comparison to Long-Term

question 24

Multiple Choice

Short-term interest rates have _________ volatility in comparison to long-term interest rates.

• A)Much less
• B)More
• C)Equal
• D)Slightly less

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Definitions:

Annual Simple Rate

The percentage rate of return calculated on an annual basis, using simple interest without compounding.

Yield

Definition: The income return on an investment, such as the interest or dividends received from holding a particular security.

Revolving Line of Credit

A flexible loan where the borrower can access funds up to a certain limit, pay back, and then borrow again without needing to reapply for a new loan.

Simple Interest

Interest computed exclusively on the original amount of a loan or deposit, without adding interest to the principal for future calculations.