投资学第7版TestBank答案15之欧阳学创编

欧阳学创编

Multiple Choice Questions

时间：2021.03.03 创作：欧阳学 1. The term structure of interest rates is: A) The relationship between the rates of interest on all

securities.

B) The relationship between the interest rate on a security

and its time to maturity.

C) The relationship between the yield on a bond and its

default rate.

D) All of the above. E) None of the above.

Answer: B Difficulty: Easy

Rationale: The term structure of interest rates is the relationship

between two variables, years and yield to maturity (holding all else constant).

2. The yield curve shows at any point in time: A) The relationship between the yield on a bond and the

duration of the bond.

B) The relationship between the coupon rate on a bond and

time to maturity of the bond.

C) The relationship between yield on a bond and the time

to maturity on the bond.

D) All of the above. E) None of the above.

Answer: C Difficulty: Easy

3. An inverted yield curve implies that: A) Long-term interest rates are lower than short-term

interest rates.

B) Long-term interest rates are higher than short-term

interest rates.

C) Long-term interest rates are the same as short-term

interest rates.

D) Intermediate term interest rates are higher than either

欧阳学创编

欧阳学创编

short- or long-term interest rates.

E) none of the above.

Answer: A Difficulty: Easy

Rationale: The inverted, or downward sloping, yield curve is one

in which short-term rates are higher than long-term rates. The inverted yield curve has been observed frequently,

although not as frequently as the upward sloping, or normal, yield curve.

4. An upward sloping yield curve is a(n) _______ yield curve. A) normal. B) humped. C) inverted. D) flat. E) none of the above.

Answer: A Difficulty: Easy

Rationale: The upward sloping yield curve is referred to as the

normal yield curve, probably because, historically, the upward sloping yield curve is the shape that has been observed most frequently.

5. According to the expectations hypothesis, a normal yield

curve implies that A) interest rates are expected to remain stable in the future. B) interest rates are expected to decline in the future. C) interest rates are expected to increase in the future. D) interest rates are expected to decline first, then increase. E) interest rates are expected to increase first, then decrease.

Answer: C Difficulty: Easy

Rationale: An upward sloping yield curve is based on the

expectation that short-term interest rates will increase. 6. Which of the following is not proposed as an explanation

for the term structure of interest rates? A) The expectations theory. B) The liquidity preference theory. C) The market segmentation theory. D) Modern portfolio theory. E) A, B, and C.

欧阳学创编

欧阳学创编

Answer: D Difficulty: Easy

Rationale: A, B, and C are all theories that have been proposed to

explain the term structure.

7. The expectations theory of the term structure of interest

rates states that A) forward rates are determined by investors' expectations

of future interest rates.

B) forward rates exceed the expected future interest rates. C) yields on long- and short-maturity bonds are determined

by the supply and demand for the securities.

D) all of the above. E) none of the above.

Answer: A Difficulty: Easy

Rationale: The forward rate equals the market consensus

expectation of future short interest rates.

8. Which of the following theories state that the shape of the

yield curve is essentially determined by the supply and demands for long-and short-maturity bonds? A) Liquidity preference theory. B) Expectations theory. C) Market segmentation theory. D) All of the above. E) None of the above.

Answer: C Difficulty: Easy

Rationale: Market segmentation theory states that the markets for

different maturities are separate markets, and that interest rates at the different maturities are determined by the intersection of the respective supply and demand curves. 9. According to the \

structure of interest rates, the yield curve usually should be: A) inverted. B) normal. C) upward sloping D) A and B. E) B and C.

Answer: E Difficulty: Easy

欧阳学创编