If Interest Rates Are Expected to Rise, You Would Expect

question 1

Multiple Choice

If interest rates are expected to rise, you would expect:

• A) bond prices to fall more than stock prices.
• B) bond prices to rise more than stock prices.
• C) stock prices to fall more than bond prices.
• D) stock prices to rise and bond prices to fall.

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Definitions:

Angel Investor

An individual who provides capital to start-up companies in exchange for ownership equity or convertible debt.

Divestiture

The process of a company selling off or liquidating a portion of its business or assets, often for strategic, legal, or financial reasons.

Time Warner

A major multinational media and entertainment conglomerate, known for producing film, television, and entertainment content.

Angel Capitalism

Investment in start-up companies by wealthy individuals, known as angel investors, who provide capital in exchange for equity or convertible debt.