Which Statement About Interest Rates Is False

question 210

Multiple Choice

Which statement about interest rates is false?

• A) The prime rate equals the overnight rate plus 3 percent.
• B) Long-run interest rates tend to be higher than short-run interest rates.
• C) Long-run bonds tend to be riskier than short-run bonds.
• D) Investors require a higher reward for forgoing more liquidity.
• E) Long-run interest rates fluctuate less than short-run interest rates.

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