Which of the Following Statements Is False

question 10

Multiple Choice

Which of the following statements is false?

• A) The yield curve changes over time.
• B) The formulas for computing present values of annuities and perpetuities cannot be used in situations in which cash flows need to be discounted at different rates.
• C) We can use the term structure to compute the present and future values of a risk-free cash flow over different investment horizons.
• D) The yield curve tends to be inverted as the economy comes out of a recession.