According to Segmented Markets Theory, If Investors Have Mostly Long-Term

question 23

Multiple Choice

According to segmented markets theory, if investors have mostly long-term funds available and borrowers want short-term funds, this will place ____ pressure on the demand for long-term funds issued by borrowers and the yield curve will be ____ sloping.

• A)upward; downward
• B)downward; upward
• C)upward; upward
• D)downward; downward

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Definitions:

Contributions

The act of giving or adding to something larger, such as ideas, work, or resources, to achieve a common goal.

Inducements

Incentives or rewards offered to motivate specific actions or behaviors from individuals or groups.

Self-serving Bias

A cognitive bias where individuals attribute positive outcomes to their own actions and negative outcomes to external factors.

Low Productivity

Reduced effectiveness in producing goods or services, often measured by output per labor hour.