If municipal bonds were to lose their tax free status

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Financial Markets & Institutions
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Chapter 22 / Exercise 01
Financial Markets & Institutions
Madura
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28) If municipal bonds were to lose their tax-free status, then the demand for Treasury bonds would shift ________, and the interest rate on Treasury bonds would ________. A) rightward; fall B) rightward; rise C) leftward; fall D) leftward; rise Answer: A
29) The relationship among interest rates on bonds with identical default risk but different maturities is called the C
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Chapter 22 / Exercise 01
Financial Markets & Institutions
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30) Yield curves can be classified as D
31) Typically, yield curves are A
32) When yield curves are steeply upward-sloping, A) long-term interest rates are above short-term interest rates. B) short-term interest rates are above long-term interest rates. C) short-term interest rates are about the same as long- term interest rates. D) medium-term interest rates are above both short-term and long-term interest rates. E) medium-term interest rates are below both short-term and long-term interest rates. Answer: A
33) Economists' attempts to explain the term structure of interest rates A
34) According to the expectations theory of the term structure,
35) According to the expectations theory of the term structure,

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