Phillip is a mortgage broker, who is paid by commission. When interest rates decline, he does a lot of business and earns a lot of money, as more people buy houses or refinance their mortgages. But when interest rates rise, business falls substantially. To diversify, Phillip should choose investments that
a. provide a higher return than the market average.
b. provide a lower return than the market average.
c. pay higher returns when interest rates rise and lower returns when interest rates fall.
d. pay lower returns when interest rates rise and higher returns when interest rates fall.
c
Economics
You might also like to view...
To increase the level of output, the Fed should conduct an open market sale
Indicate whether the statement is true or false
Economics
In an economy experiencing hyperinflation, we expect to observe
A) an increase in the demand for money and an increase in velocity. B) an increase in the demand for money and a reduction in velocity. C) a decrease in the demand for money and an increase in velocity. D) a decrease in the demand for money and a reduction in velocity.
Economics