If the Yield Curve Is Upward Sloping,then Which Type of Marketable

question 16

Multiple Choice

If the yield curve is upward sloping,then which type of marketable securities,assumed to be held for emergencies,should be held in a firm's portfolio?

• A)They should consist mainly of long-term securities because those pay higher rates.
• B)They should consist mainly of short-term securities because those pay higher rates.
• C)They should consist mainly of government securities to minimize interest rate risk.
• D)They should consist mainly of short-term securities to minimize interest rate risk.

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Definitions:

Chitins

A long-chain polymer of N-acetylglucosamine, a derivative of glucose, and a primary component of the cell walls of fungi and the exoskeletons of arthropods.

Annelids

A phylum of invertebrate animals known as segmented worms, which includes earthworms, leeches, and their relatives, characterized by a segmented body and a coelom.

Two Openings

Refers to organisms with a digestive system that has a distinct mouth and anus, allowing for a one-way flow of food and waste.

Cnidarians

A phylum of aquatic invertebrates known for their distinctive body structure with a jelly-like substance called mesoglea, radial symmetry, and specialized cells called cnidocytes.