The bond demand curve slopes downward because:
A. as bond prices fall bonds are less attractive.
B. as bond prices fall so do yields.
C. as bond prices rise yields increase.
D. at lower prices the reward for holding the bond increases.
Answer: D
You might also like to view...
An economic model suggests that an additional year of education increases a student's future wages by 15 percent. Using this model, answer the following questions: a) Gary completes 8 years of education, and John completes 9 years of education
If Gary earns $20 per hour, how much is John expected to earn? b) John completes 9 years of education, and Kevin completes 12 years of education. Given John's earnings [as calculated in a)], how much is Kevin expected to earn? c) Is there any limitation to such a model? Explain your answer.
The marginal benefit is the
A) additional gain from one more unit of an activity. B) additional cost from one more unit of an activity. C) loss of the highest-valued alternative. D) additional gain from one more unit of an activity minus the additional cost from one more unit of the activity.
The first fundamental theorem of welfare economics states that
A) under certain conditions, a competitive equilibrium is Pareto optimal. B) a competitive equilibrium is always Pareto optimal. C) under certain conditions, a Pareto optimum is a competitive equilibrium. D) a Pareto optimum is always a competitive equilibrium.
Which of the following was a contributing factor to the instability of 2002 to 2008?
a. ideal weather from 2002 to 2006, followed by a severe drought in 2007 and 2008 b. falling housing prices leading to an expansion, followed by rising housing prices leading to a sharp economic downturn c. an increase in housing prices leading to an expansion, followed by a collapse in housing prices and a sharp economic downturn d. falling stock prices leading to an expansion, followed by rising stock prices leading to a sharp economic downturn