What is the typical relationship between time and interest rate?
a) Longer time periods usually have no effect on interest rates.
b) Longer time period usually equals higher interest rates.
c) Shorter time periods usually have no effect on interest rates.
d) Shorter time period usually equals higher interest rates.
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The Correct Answer for the given question is Option b) Longer time period usually equals higher interest rates.
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If the market rate of interest is greater than the contractual rate of interest, bonds will sell
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