Exhibit 36-1 Bond FaceValueof Bond Price ofthe Bond Annual CouponPayment A $1,000 $850 $25 B $1,000 $950 $41 C $1,000 $1,100 $52 D $1,000 $1,100 $32 E $1,000 $1,000 $50 Refer to Exhibit 36-1. The coupon rate for bond A is
A. 2.5 percent.
B. 2.9 percent.
C. 7.5 percent.
D. 0.025 percent.
Answer: A
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Bongo plays drums in his parents' garage after school. What can we be sure of?
A) Bongo's drumming imposes negative externalities on others. B) Bongo's drumming delivers positive externalities to others. C) Bongo expects to benefit while drumming. D) All of the above.
Monopolistically competitive firms have downward-sloping demand curves. In the long run, monopolistically competitive firms earn zero economic profits. These two characteristics imply that in the long run
A) monopolistically competitive markets achieve productive efficiency. B) monopolistically competitive firms have excess capacity. C) monopolistically competitive firms earn economic profits. D) monopolistically competitive markets achieve allocative efficiency.
Which of the following is not a benefit to lenders/investors of financial intermediation?
a. Lower transaction costs than the direct market. b. Lower risks than the direct market. c. More diversification than the direct market. d. More convenient than the direct market. e. Higher yield than the direct market.
A corrective tax
a. can be used to internalize a negative externality. b. imposed on sellers shifts the supply curve to the left. c. imposed on buyers shifts the demand curve to the left. d. All of the above are correct.