A bond that pays a yearly interest rate of? $100 is for sale. The interest rate was 10 percent and now is 5 percent. The price of the bond has
A) decreased from $1000 to $500.
B) increased from $1000 to $2000.
C) decreased from $2000 to $1000.
D) increased from $500 to $2000.
Ans: B) increased from $1000 to $2000.
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The demand curve is: QD = 500 - 1/2 P
a. Calculate the (point) price elasticity of demand when price is $100. Is demand elastic or inelastic? b. Calculate the (point) price elasticity of demand when price is $700. Is demand elastic or inelastic? c. Find the point at which point elasticity is equal to -1.
A horizontal line has an infinite slope
a. True b. False Indicate whether the statement is true or false
If consumption spending increases from $758 to $767 billion when disposable income increases from $912 to $927 billion, it can be concluded that the marginal propensity to consume is:
a. 0.4 b. 0.5 c. 0.7 d. 0.6
A small country is considering imposing a tariff on imported wine at the rate of $5 per bottle. Economists have estimated the following based on this tariff amount: World price of wine (free trade):$20 per bottleDomestic production (free trade):500,000 bottlesDomestic production (after tariff):600,000 bottlesDomestic consumption (free trade):750,000 bottlesDomestic consumption (after tariff):650,000 bottles The consumption effect of the tariff on wine is worth about
A. $3.5 million. B. $2.75 million. C. $500,000. D. $250,000.