When the interest rate on newly issued bonds increases, the price of existing bonds:
A. decreases.
B. may either increase or decrease.
C. increases.
D. increases only if the coupon rate is below the new rate.
Answer: A
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If the economy is above full employment, there is ________ gap, and as the economy adjusts toward full employment, the price level ________
A) a recessionary; rises B) an inflationary; falls C) a recessionary; falls D) an inflationary; does not change E) an inflationary; rises
A student comments to his roommate that the only way he will be able to pass his final exams is to not sleep for the next three days. This statement suggests that
A) society should value good grades more highly than sleep because students can catch up on their sleep once final exams are over. B) there is a trade-off between studying and sleep. C) students are more concerned about good grades than good health. D) society should value sleep more highly than good grades.
Suppose researchers discover that a government program to match job seekers and employers has caused an increase in the unemployment rate. Does this mean that the program has failed?
What will be an ideal response?
To John Maynard Keynes, investment demand depends less upon the availability of saving than upon the profit expectations of producers
Indicate whether the statement is true or false