欧阳阳理创编 2021.03.04
Multiple Choice Questions
时间：2021.03.05 创作：欧阳理 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
欧阳阳理创编 2021.03.04
欧阳阳理创编 2021.03.04
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?
欧阳阳理创编 2021.03.04
欧阳阳理创编 2021.03.04
A) The expectations theory.
B) The liquidity preference theory. C) The market segmentation theory. D) Modern portfolio theory. E) A, B, and C.
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.
欧阳阳理创编 2021.03.04
投资学第7版TestBank答案15之欧阳理创编
