The marginal propensity to consumers (MPC) can be defined as a fraction of
A) a change in income that is saved
B) income that is spent
C) a change in income that is spent
D) income that is saved
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C) a change in income that is spent
If 1-year interest rates for the next three years are expected to be 6, 4 and 5 percent,
and the three year term premium is 2%, then the 3-year bond rate will be
A) 5%
B) 6%
C) 8%
D) 7%
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D) 7%
The price of a zero coupon bond and the yield to maturity are ___________ related; that is,
as the yield to maturity ______________, the price of the bond ___________.
A) negatively, rises, falls
B) positively, rises, falls
C) positively, rises, rises
D) negatively, falls, falls
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A) negatively, rises, falls
A zero coupon bond pays annual interest and has a future value of $1,000, matures in
4 years and has a yield to maturity of 6.5%. What is the present value of this bond?
A) $902.65
B) $833.24
C) $1,072.33
D) $777.32
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D) $777.32
In the bond market, the bond demanders are the ______________ and the bond suppliers
are the ____________.
A) lenders, borrowers
, B) borrowers, advancers
C) borrowers, lenders
D) lenders, advancers
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A) lenders, borrowers
The Keynesian framework indicates that government can play an important role in
determining aggregate output by
A) only by changing the level of government spending
B) both changing the level of government spending and changing taxes
C) only by changing taxes
D) the government can't play a role in determining aggregate output
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B) both changing the level of government spending and changing taxes
The spread between interest rates on bonds with default risk and default free bonds
is called the
A) risk margin
B) liquidity premium
C) risk premium
D) default premium
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C) risk premium
A) a change in income that is saved
B) income that is spent
C) a change in income that is spent
D) income that is saved
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C) a change in income that is spent
If 1-year interest rates for the next three years are expected to be 6, 4 and 5 percent,
and the three year term premium is 2%, then the 3-year bond rate will be
A) 5%
B) 6%
C) 8%
D) 7%
,Give this one a try later!
D) 7%
The price of a zero coupon bond and the yield to maturity are ___________ related; that is,
as the yield to maturity ______________, the price of the bond ___________.
A) negatively, rises, falls
B) positively, rises, falls
C) positively, rises, rises
D) negatively, falls, falls
Give this one a try later!
A) negatively, rises, falls
A zero coupon bond pays annual interest and has a future value of $1,000, matures in
4 years and has a yield to maturity of 6.5%. What is the present value of this bond?
A) $902.65
B) $833.24
C) $1,072.33
D) $777.32
Give this one a try later!
D) $777.32
In the bond market, the bond demanders are the ______________ and the bond suppliers
are the ____________.
A) lenders, borrowers
, B) borrowers, advancers
C) borrowers, lenders
D) lenders, advancers
Give this one a try later!
A) lenders, borrowers
The Keynesian framework indicates that government can play an important role in
determining aggregate output by
A) only by changing the level of government spending
B) both changing the level of government spending and changing taxes
C) only by changing taxes
D) the government can't play a role in determining aggregate output
Give this one a try later!
B) both changing the level of government spending and changing taxes
The spread between interest rates on bonds with default risk and default free bonds
is called the
A) risk margin
B) liquidity premium
C) risk premium
D) default premium
Give this one a try later!
C) risk premium
