A Treasury Bond Due in One Year Has a Yield

question 43

Multiple Choice

A Treasury bond due in one year has a yield of 6.2%; a Treasury bond due in five years has a yield of 6.7%. A bond issued by Xerox due in five years has a yield of 7.9%; a bond issued by Exxon due in one year has a yield of 7.2%. The default risk premiums on the bonds issued by Exxon and Xerox, respectively, are

• A) 1.0% and 1.2%.
• B) 0.5% and .7%.
• C) 1.2% and 1.0%.
• D) 0.7% and 0.5%.
• E) None of the options are correct.

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Definitions:

Dopamine

A neurotransmitter involved in controlling the brain's reward and pleasure centers, and regulating movement and emotional responses.

Myelin Sheath

A fatty layer that encases the axons of some nerve cells, facilitating the rapid transmission of nerve impulses.

Axon

A long, narrow outgrowth of a neuron’s cell body that lets the neuron transmit information to other neurons.

Acetylcholine

A neurotransmitter in both the central and peripheral nervous systems involved in muscle activation and memory among other functions.