The market prices of existing bonds are
A. not related to the interest rate.
B. inversely related to the interest rate.
C. stated in terms of the interest rate.
D. directly related to the interest rate.
Answer: B
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Suppose that your marginal federal income tax rate is 30%, the sum of your marginal state and local tax rates is 5%, and the yield on a thirty-year corporate bond is 10%
You would be indifferent between buying this corporate bond and buying a thirty-year municipal bond issued within your state (ignoring differences in liquidity, risk, and costs of information) if the municipal bond has a yield of A) 6.5%. B) 7.0%. C) 9.5%. D) 10.0%.
Economics can be described as the study of how people use ________ resources to satisfy ________ wants
A) unlimited; unlimited B) unlimited; limited C) limited; unlimited D) limited; limited
Economists generally believe that rent control is
a. an efficient and fair way to help the poor. b. inefficient but the best available means of solving a serious social problem. c. a highly inefficient way to help the poor raise their standard of living. d. an efficient way to allocate housing, but not a good way to help the poor.
When a monopolist sells two units of output its total revenue is $600. When a monopolist sells three units of output its total revenue is $630. In order to sell three units of output instead of only two, the monopolist must
A. decrease its price by $30 per unit. B. increase its price by $30 per unit. C. decrease its price by $90 per unit. D. make no change in price and increase output by one unit.