Three Factors That Cause Interest Rates Among Different Financial Instruments

question 11

Multiple Choice

Three factors that cause interest rates among different financial instruments to vary are

• A)default risk, expected inflation, and taxability.
• B)default risk, current inflation, and taxability.
• C)default risk, maturity, and taxability.
• D)default risk, expected inflation, and maturity.

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Definitions:

Product Name

The title given to a merchandise or service to distinguish it from other offerings.

Trademark

A distinguishable symbol, pattern, or phrase that differentiates the goods or services of a specific origin from those of other sources.

Oligopolists

Firms or individuals that dominate a particular market, leading to a market structure known as oligopoly, where a few entities control the majority of market share.

Undistributed Profits

Profits earned by a company that are not paid out as dividends to shareholders but are retained within the company for reinvestment.