You Expect Interest Rates to Rise in the Short Term

question 86

Multiple Choice

You expect interest rates to rise in the short term.Your best strategy would be to

• A)buy T-bills and keep rolling them over.
• B)buy long bonds and use interest income to purchase higher yields.
• C)buy short bonds only and keep rolling them over.
• D)buy T-bills in anticipation of locking in higher rates after the increase.

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Definitions:

Asch's Studies

A series of experiments conducted by Solomon Asch focusing on the effects of peer pressure on conformity, demonstrating how individuals yield to or defy a majority group.

Conformity

The act of aligning one's beliefs, behaviors, or attitudes to match those of a group or societal norms.

Conformity

Adjusting one's behavior or thinking to match those of other people or a group standard.

Asian Countries

Nations located on the continent of Asia, including, but not limited to, China, India, Japan, and South Korea.