Answer the next question on the basis of the following information for a bond having no expiration date: bond price = $1,000; bond fixed annual interest payment = $100; bond annual interest rate = 10%. If the price of this bond falls by $200, the interest rate will
A. fall by 2.5 percentage points.
B. fall by 5 percentage points.
C. rise by 5 percentage points.
D. rise by 2.5 percentage points.
Answer: D
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In the figure above, with no government involvement and if the colleges are competitive, what is the deadweight loss?
A) $12 billion per year B) $6 billion per year C) $4 billion per year D) zero
Shocks to the macroeconomy will cause a change in the equilibrium real interest rate, except ________
A) permanent supply shocks B) aggregate demand shocks C) temporary supply shocks D) all of the above E) none of the above
Suppose the total cost of producing T-shirts can be represented as TC = 50 + 2q. The average cost of the 5th T-shirt is
A) 2. B) 12. C) 52. D) 60.
Owners have limited liability for debt
What will be an ideal response?