Assume that you purchased a $1,000 perpetual bond that pays a market interest rate of 5 percent. If you attempted to sell this bond today subsequent to an increased market rate of interest of 7.5 percent, then you
a. could only sell this bond at a capital loss.
b. could sell this bond at a capital gain.
c. would not be able to sell this bond.
d. could exchange your bond yielding 5 percent for a bond yielding 7.5 percent on an even exchange basis.
A
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On a production possibilities frontier, 500 pounds of apples and 1,200 pounds of bananas can be produced while at another point on the same frontier, 300 pounds of apples and 1,300 pounds of bananas can be produced
Between these points, what is the opportunity cost of producing a pound of apples? A) 2 pounds of bananas B) 5/12 of a pound of bananas C) 0.5 of a pound of bananas D) 2 pounds of apples E) 100 pounds of bananas
If the quantity supplied in a market exceeds the quantity demanded in a market, we would expect price to:
A) stay the same. B) increase. C) decrease. D) rise in order to clear the market.