Everything Else Equal, If You Expect a Larger Interest Rate

question 46

Multiple Choice

Everything else equal, if you expect a larger interest rate increase than other market participants, you should ________.

• A) buy long-term bonds
• B) buy short-term bonds
• C) buy common stocks
• D) buy preferred stocks

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Definitions:

Maximum Penalty

The most severe punishment that can be imposed for a particular offence by a court of law.

Life Imprisonment

A sentence of imprisonment for a crime where the convicted person is to remain in prison for the rest of their life.

Serious Crime

A criminal offense that is considered severely harmful to individuals or society, typically involving violence or the threat of violence, and carrying heavy penalties.

Imprisonment

The act of confining someone in a prison as a legal punishment for committing a crime.