A Country's Net Outflow of Funds ____ Affect Its Interest

question 8

Multiple Choice

A country's net outflow of funds ____ affect its interest rates, and ____ affect its economic conditions.

• A) does; does
• B) does; does not
• C) does not; does not
• D) does not; does

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Definitions:

Original Maturity

This refers to the duration from the issuance of a bond or other fixed-income security until its due date.

Default Risk

The risk that a borrower fails to make the required payments on their debt obligation.

Canada Call Feature

A special feature on certain bonds that allows the issuer to redeem the bond before maturity in the Canadian market.

Maturity

Maturity indicates the date on which the principal amount of a financial instrument is due to be paid back.