Increasing tensions in many parts of the world should:
A) Cause the demand for all government securities including U.S. Treasury securities to decrease
B) Cause the risk spread between U.S. Treasury bonds and other bonds to decrease
C) Cause the price of U.S. Treasury bonds to increase and the yield on other bonds to increase
D) Cause the price of U.S. Treasury bonds to increase and the yield on other bonds to decrease

Question

Quizplus · Accepted Answer

In times of increased global tensions, investors often seek safe-haven assets like U.S. Treasury bonds, driving their prices up and yields down. Conversely, yields on riskier bonds may increase due to perceived higher risk.

Increasing Tensions in Many Parts of the World Should