Under the Expectations Theory,investors Expecting Interest Rates to Rise Will

question 29

Multiple Choice

Under the expectations theory,investors expecting interest rates to rise will:

• A)invest more now in long term bonds rather than in short term bonds.
• B)invest more now in short term bonds rather than in long term bonds.
• C)invest more now in Treasury bonds rather than in corporate bonds.
• D)invest more now in corporate bonds rather than in Treasury bonds.

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Definitions:

Sublimation

A defense mechanism in psychoanalytic theory where socially unacceptable impulses or idealizations are unconsciously transformed into socially acceptable actions or behavior.

Displacement

In psychology, a defense mechanism where an individual shifts negative feelings or behaviors from the original source to a safer or more accessible target.

Defense Mechanisms

Psychological strategies used unconsciously to protect oneself from anxiety or unacceptable thoughts and feelings.

Neuroses

Refers to a range of psychological disorders characterized by anxiety, depression, or other feelings of unhappiness or distress that are out of proportion to the circumstances of a person's life.