If You Think That Interest Rates Are Likely to Rise

question 48

True/False

If you think that interest rates are likely to rise substantially over the next several years,you might sell a T-bond futures contract or buy an interest rate cap to take advantage of your expectations.

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Definitions:

Shaping

A method of positive reinforcement in operant conditioning that rewards successive approximations towards a desired behavior.

Secondary Learning

Refers to the learning that builds on or derives from previous knowledge or skills.

Negative Reinforcement

A response or behavior is strengthened by stopping, removing, or avoiding a negative outcome or aversive stimulus.

Operant Conditioning

A method of learning that occurs through rewards and punishments for behavior, enhancing or diminishing the likelihood of a behavior being repeated.