A month ago, you bought a one-year bond with a value of $100 that pays a fixed interest rate of 5 percent per year. The interest rate of the economy was also 5 percent. Today you read in the newspaper that the interest rate in the economy decreased to 3 percent. You are holding a bond that is:
A. more desirable to other investors.
B. not desirable at all.
C. desirable to you.
D. less desirable to other investors.
Answer: A
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If the number of potential workers in an economy increases while the size of the labor force remains unchanged, ________
A) the labor force participation rate will fall B) the labor force participation rate will remain unaffected C) the labor force participation rate will increase D) the natural rate of unemployment will increase
What limited the effectiveness of monetary policy during the Financial Crisis of 2007-2009?
What will be an ideal response?
Recall the Application the Joint Committee on Taxation and how Congress accounts for the dynamic effects of its policies to answer the following questions.The results highlighted in this Application shows that President Trump's tax cuts resulted in:
A. a decrease in tax revenue. B. an increase in tax revenue. C. no change in tax revenue. D. an increase in tax revenues early on, before tax revenues decreased in the long run.
If a corporate bond with face value of $8,000 has an interest rate of 4 percent paid once a year for a term of 30 years, what is the size of the coupon payment?
A) $320 B) $2,000 C) $8,000 D) $9,600