Which of the Following Statements Is CORRECT

question 20

Multiple Choice

Which of the following statements is CORRECT?

• A) The yield on a 2-year corporate bond should always exceed the yield on a 2-year Treasury bond.
• B) The yield on a 3-year corporate bond should always exceed the yield on a 2-year corporate bond.
• C) The yield on a 3-year Treasury bond should always exceed the yield on a 2-year Treasury bond.
• D) If inflation is expected to increase,then the yield on a 2-year bond should exceed that on a 3-year bond.
• E) The real risk-free rate should increase if people expect inflation to increase.

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Definitions:

Monozygotic

Pertaining to twin siblings who originate from a single fertilized egg, resulting in individuals with identical genetic material.

Twins

Siblings born simultaneously from the same pregnancy, which can be identical (monozygotic) or fraternal (dizygotic).

Zygote

An ovum that has been fertilized by a sperm and thus contains a full complement of 46 chromosomes, half from the mother and half from the father.

Prenatal Deprivation

Prenatal Deprivation involves the lack or insufficiency of necessary nutrients, care, or emotional support to the fetus during pregnancy, which can result in developmental issues.