Which of the Statements Below Is FALSE

question 47

Multiple Choice

Which of the statements below is FALSE?

• A)If you invest money for a short period and buy a six-month CD,you will not receive as high an interest rate as if you bought a CD with a longer maturity period.
• B)The difference in rates as the borrowing time or investment horizon increases is due to the maturity premium of the investments.
• C)The maturity premium represents that portion of the yield that compensates the investor for the additional waiting time or the lender for the additional time it takes to receive repayment in full.
• D)The longer the loan,the greater the risk of nonpayment and the lower the interest rate the lender demands.

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Definitions:

Monopolist

A market participant that is the sole seller of a good or service, enabling them to control the market price.

United States

A country in North America, comprising 50 states, known for its economic and military power as well as its cultural influence worldwide.

England

A country in Europe known for its rich history, contributions to economic theory, and as the birthplace of the industrial revolution.

Demand Segmentation

The process of dividing a market into distinct subsets of customers according to different needs, characteristics, or behaviors, who might require separate products or marketing mixes.