The current price of a government bond is $920. The bond pays $90 in interest this year. At the end of the current year, the bond matures, and the principal of $1,000 is repaid. What is the return to the holder of this bond?
A) 1 percent
B) 8 percent
C) 9 percent
D) 17 percent
D
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If business inventories equal $40 billion at the beginning of the year and $55 billion at the end of the year, then, assuming no other changes, GDP must have:
A. increased by $40 billion. B. increased by $15 billion. C. decreased by $15 billion. D. increased by $55 billion.
Perfect competition is characterized by
A) many buyers and sellers. B) a small number of firms. C) differentiated products of firms in the industry. D) high barriers to entry.
Mr. and Mrs. Jones want to invest for their retirement by buying stocks. Mr. Jones has heard about an up-and-coming stock and wants to invest $10,000 in it. Mrs. Jones thinks it would be more prudent to invest $10,000 in a mutual fund because it would be _____________ and therefore ______________.
a. quicker/more profitable b. diversified/less risky c. easier to understand/have a greater return d. collectible/earn equity
Assuming MPC = 0.5, a $2,000 decrease in intended investment will shift the aggregate expenditure curve down by
a. $2,000 and will decrease the equilibrium level of national income by $2,000 b. $2,000 and will decrease the equilibrium level of national income by less than $2,000 c. $2,000 and will decrease the equilibrium level of national income by more than $2,000 d. more than $2,000 and will decrease the equilibrium level of national income by more than $2,000 e. less than $2,000 and will decrease the equilibrium level of national income by less than $2,000