A bond issuer agrees to pay a stated nominal amount each year. An increase in the nominal interest rate will cause
A) the price of the bond to fall.
B) the price of the bond to rise.
C) the nominal value of the bond's coupon to rise.
D) the nominal value of the bond's coupon to fall.
A
You might also like to view...
As an economy moves down along a straight line production possibilities frontier, what happens to the opportunity cost of producing the good on the horizontal axis?
A) It remains constant. B) It decreases. C) It increases. D) Above the midpoint it decreases until it equals 1 at the midpoint and then it increases. E) None of these depicts what happens to opportunity cost.
If, for a $1000 premium, you buy a $100,000 call option on bond futures with a strike price of 110, and at the expiration date the price is 114, your ________ is ________
A) profit; $4000 B) loss; $4000 C) profit; $3000 D) loss; $3000
Over time, technology tends to:
A. set countries apart in terms of productivity. B. allow developing nations to experience the "catch-up" effect. C. diminish in nations that are still developing. D. spread from country to country, equalizing opportunity costs.
A monopolistically competitive firm in the long run will
A. have a demand curve tangent to its AC. B. have a demand curve below its AC. C. have a demand curve above its AC. D. operate where excessive profit can be achieved.