In: Economics
Which of the following statements is CORRECT?
Select one:
a. When the yield curve is strictly downward sloping, the term spread must be positive.
b. A flight to quality during the recession increases the default risk premium.
c. The market capitalization of a corporation is the total market value of its common stocks.
d. Legal tender is the provision that shields owners of a corporation from losing more than what they have invested in the firm.
Answer = correct option is B
A flight to quality during the recession increase default of risk premium
Other option are incorrect because -