are the rates stated or quoted in the terms or contract of a particular security. Which is false about the factors that influences nominal interest rates? a. Government issued securities will only include maturity risk premium if the security is a long-term one b. The liquidity risk premium which is present in all corporate securities are used to compensate investors for the possibility of difficulty in converting the security into cash c. The short-term government securities do not have a real risk-free rate component d. Regardless of whether issued by the government or c
are the rates stated or quoted in the terms or contract of a particular security. Which is false about the factors that influences nominal interest rates? a. Government issued securities will only include maturity risk premium if the security is a long-term one b. The liquidity risk premium which is present in all corporate securities are used to compensate investors for the possibility of difficulty in converting the security into cash c. The short-term government securities do not have a real risk-free rate component d. Regardless of whether issued by the government or c
Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter18: Initial Public Offerings, Investment Banking, And Capital Formation
Section: Chapter Questions
Problem 3Q
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Nominal interest rates are the rates stated or quoted in the terms or contract of a particular security. Which is false about the factors that influences nominal interest rates?
a. Government issued securities will only include maturity risk premium if the security is a long-term one
b. The liquidity risk premium which is present in all corporate securities are used to compensate investors for the possibility of difficulty in converting the security into cash
c. The short-term government securities do not have a real risk-free rate component
d. Regardless of whether issued by the government or corporation, nominal rates have inflation premiums
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