Which of the Following Statements Is False

question 16

Multiple Choice

Which of the following statements is false?

• A) The relationship between the investment term and the interest rate is called the term structure of interest rates.
• B) Real interest rates indicate the rate at which your money will grow if invested for a certain period.
• C) The yield curve is a potential leading indicator of future economic growth.
• D) The shape of the yield curve will be strongly influenced by interest rate expectations.

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Definitions:

Market System

A financial structure where choices about investment, production, and allocation are determined by market forces of supply and demand.

Market System

The economy operates under a system where investment decisions, production processes, and distribution plans are shaped by the principles of supply and demand, and the open market is where prices for goods and services are freely established.

Allocation Of Resources

The process of assigning available resources, or inputs, to specific uses chosen among many possible and competing alternatives in order to achieve goals.

Income Distribution

The manner in which a nation’s total earnings are divided among its population, affecting economic equality.