The USGovernment Debt Managers Use Interest-Rate Swaps Primarily Because

question 106

Multiple Choice

The U.S.Government debt managers use interest-rate swaps primarily because:

• A)The U.S.Government runs large deficits.
• B)The debt managers prefer to issue long-term bonds because they are cheaper to issue but prefer short-term variable rate obligations to match revenues.
• C)The debt managers find it difficult to borrow from traditional debt markets.
• D)They are required by law to keep the cost of borrowing to a minimum.

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Definitions:

Neither Verbal Nor Visual

Refers to information or processes that do not rely on language or imagery, potentially involving other sensory modalities or cognitive operations.

Demand Characteristics

Subtle cues or signals in an experimental environment that influence the behavior or responses of participants.

Mental Rotation

The cognitive ability to rotate mental representations of two-dimensional and three-dimensional objects in the mind's eye.

Mnemonic Usage

The application of mnemonic devices or techniques to improve memory recall.