Investors Will Generally Accept a Lower Yield on ________ Than

question 60

Multiple Choice

Investors will generally accept a lower yield on ________ than on ________ of comparable terms,making them a less costly source of funds for the issuer to service.

• A)bearer bonds; registered bonds
• B)registered bonds; bearer bonds
• C)Eurobonds; domestic bonds
• D)domestic bonds; Eurobonds

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Definitions:

Smooth Consumption

A concept in economics where individuals prefer to have a stable consumption pattern over time, smoothing out the highs and lows in their spending and consumption.

Future Earnings

The expected amount of money an individual, business, or asset is anticipated to generate in the future.

Behavioral Economists

Specialists in economics focusing on how psychological, emotional, cultural, and social factors influence the economic decisions of individuals and institutions.

Realized Losses

Losses that occur when an asset is sold for less than its purchase price, thereby converting a theoretical loss into an actual loss.