Assume the bonds below have the same term and principal and that the state or local government that issues the municipal bond has a good credit rating. Which list has bonds correctly ordered from the one that pays the highest interest rate to the one that pays the lowest interest rate?
a. corporate bond, municipal bond, U.S. government bond
b. corporate bond, U.S. government bond, municipal bond
c. municipal bond, U.S. government bond, corporate bond
d. U.S. government bond, municipal bond, corporate bond
b
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Open market operations are the
A) purchase or sale of government securities by the Fed. B) lending of reserves to the banking system by the Fed. C) borrowing of reserves by the Fed from the banking system. D) minimum percentage of loans that banks must retain as reserves in the open market. E) purchase or sale of gold by the Fed.
Assuming upward sloping labor supply, wage subsidies are definitely more inefficient
A. the more elastic labor demand is. B. the more elastic labor supply is. C. the more substitutable consumption and leisure are. D. Both (a) and (b) E. Both (b) and (c) F. Both (a) and (c) G. All of the above H. None of the above
The reason a shock to one sector can spread to the whole economy is that
a. a decrease in production in one sector leads to an overall decrease in spending b. firms will need to help bail out other firms that are having troubles c. an increase in production in one sector will lead to an overall decrease in spending d. most shocks are not sector-specific but economy-wide e. workers laid off in the one sector will purchase more goods in another sector
The bottom 80 percent of the families in the United States receive approximately ________ percent of total income.
A. 90 B. 20 C. 50 D. 10