Suppose you purchase a one-year bond that has a $450 coupon and a face value of $5,000, and immediately after you purchase the bond, new bonds are issued that are otherwise identical, except they have coupons of $375
If you sell your bond, you will A) suffer a loss of $5.76.
B) suffer a loss of $412.84.
C) receive a gain of $69.77.
D) receive a gain of $418.60.
C
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If buyers of illegal goods are punished but sellers are not, then the price ________ and the equilibrium quantity ________
A) rises; increases B) rises; decreases C) falls; increases D) falls; decreases
Nondeliverable forward exchange markets in centers such as Hong Kong and Singapore help to circumvent which problem?
A) loss of goods shipped from Hong Kong and Singapore B) inconvertible currencies cannot be traded in foreign markets C) lag between the spot exchange date and the value date D) high travel costs from Asia to "traditional" foreign exchange markets E) unstable currencies that hold no purchasing power