AFP
CTP · Question #165
(Topic 2) If the Federal Reserve Board increased the discount rate, you would expect:
The correct answer is C. long-term bonds to decrease more in price than short-term bonds. See the full explanation below for the reasoning.
Question
- (Topic 2)
If the Federal Reserve Board increased the discount rate, you would expect:
Options
- Along-term bonds to increase more in price than short-term bonds.
- Bshort-term bonds to decrease more in price than long-term bonds.
- Clong-term bonds to decrease more in price than short-term bonds.
- Dthat there would be no effect on either long- or short-term bond prices.
How the community answered
(31 responses)- A3% (1)
- B13% (4)
- C81% (25)
- D3% (1)
Community Discussion
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