Interest rate expectations have been thought to be an important influence on bond sales because: | Faculties

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Ranjeet

🎓 Tutor III ⭐ 34.60K Points

📊 Financial Markets and Institutions

Q. Interest rate expectations have been thought to be an important influence on bond sales because:

(A) government bond-holders are, by and large, are income risk averse.
(B) interest rates have always been very unstable.
(C) the bond market is dominated by people interested mainly in capital gains.
(D) government bond-holders hold extrapolative expectations.

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✅ Correct Answer: (C) the bond market is dominated by people interested mainly in capital gains.

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