please answer quickly ...

QUESTION 1

If inflation is expected to decrease, then

a.

borrowers will demand more funds at the existing equilibrium interest rate.

b.

the equilibrium interest rate will increase.

c.

the equilibrium interest rate will decrease.

d.

savers will provide less funds at the existing equilibrium interest rate.

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QUESTION 2

A downward-sloping yield curve indicates that Treasury securities with ____ maturities offer ____ annualized yields.

a.

longer; higher

b.

shorter; the same (short-term and long-term annualized yields are the same)

c.

shorter; lower

d.

longer; lower

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QUESTION 3

Which of the following established the Office of Credit Ratings and mandated that credit rating agencies establish internal controls to make their ratings process more transparent?

a.

Consumer Protection Act of 2008

b.

Financial Reform Act of 2010

c.

Federal Ratings Commission Act of 2014

d.

None of the above is correct.

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QUESTION 4

Vaughn Corporation is considering the issue of commercial paper and would like to know the yield it should offer on its commercial paper. The corporation believes that a 0.2 percent credit risk premium, a 0.1 percent liquidity premium, and a 0.3 percent tax adjustment are necessary to sell its commercial paper to investors. Furthermore, annualized rates on short-term Treasury securities (T-bills) are 7 percent. Based on this information, Vaughn should offer ____ percent on its commercial paper.

a.

7.9

b.

7.5

c.

7.6

d.

None of these are correct.

e.

8.0