Under a Normal Upward Sloping Yield Curve Scenario,fifteen Year Fixed-Rate

question 23

Multiple Choice

Under a normal upward sloping yield curve scenario,fifteen year fixed-rate mortgages should be priced _________ thirty-year fixed-rate mortgages.

• A) equal to
• B) less than
• C) greater than
• D) there is no relationship to the yield curve

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Definitions:

Algebraic Expression

A mathematical phrase that can contain ordinary numbers, variables, and operators, but does not have an equals sign.

Difference

The result of subtracting one number from another.

Algebraic Expression

An expression built up from integer constants, variables, and the algebraic operations (such as addition, subtraction, multiplication, and division).

Algebraic Expression

A mathematical phrase that can contain ordinary numbers, variables, and operation symbols but does not have an equal sign.