Which of the Following Is Not True of Low Interest

question 23

Multiple Choice

Which of the following is not true of low interest rates?

• A) It encourages investors to search out investments like high dividend stock.
• B) It encourages the substitution of debt for equity.
• C) Low interest rates have increased the supply of credit.
• D) Low rates penalized savers.
• E) Low rates may discourage paying down the national debt.

---

Definitions:

Fair Value

An estimate of the price at which an asset or liability could be bought or sold in a current transaction between willing parties.

Cash

Currency or coins that are used as a medium of exchange for transactions; also, readily available liquidity or assets.

Partnership Act

Legislation governing the operation of partnerships, detailing the rights and responsibilities of each partner.

Partnership Creditors

Individuals or entities to whom a partnership owes money or has a debt obligation.