The _____________ Is the Difference in Return Earned by Investing

question 62

Multiple Choice

The _____________ is the difference in return earned by investing in a longer term bond that has the same credit risk as a shorter-term bond.

• A)purchasing power spread
• B)credit risk premium
• C)horizon risk premium
• D)two of the above
• E)none of the above

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Definitions:

Absolute Advantage

The ability of a country, individual, company, or region to produce a good or offer a service at a lower cost per unit than the cost at which any other entity produces that good or offers that service.

Production

The process of creating goods and services by combining labor, materials, and technology.

Kegs

Large barrels used to store and transport liquids, especially alcoholic beverages such as beer.

Pizzas

A popular dish made from yeasted flatbread typically topped with tomato sauce, cheese, and various toppings and then baked.