A change in the risk-free rate would not be due to
A) an international trade embargo.
B) a change in Federal Reserve policy.
C) foreign competition in the firm's product market area.
D) none of the above.

Question

Quizplus · Accepted Answer

Foreign competition in the firm's product market area would not directly impact the risk-free rate, as it is determined by factors such as government policies and the performance of the economy. A and B could both potentially impact the risk-free rate, as an international trade embargo or a change in Federal Reserve policy could affect inflation and interest rates. D is an incorrect option, as one of the choices (C) does not fit the criteria.

A Change in the Risk-Free Rate Would Not Be Due