Based on our understanding of the determinants of the interest rate and bond prices, we know that a reduction in income will cause
A) an increase in bond prices and an increase in the interest rate (i).
B) a reduction in bond prices and an increase in i.
C) an increase in bond prices and a reduction in i.
D) a reduction in bond prices and a reduction in i.
E) none of the above
C
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Which one of the following factors will most likely cause an increase in aggregate demand?
a. An increase in net exports. b. An increase in the real interest rate. c. A decrease in net exports due to falling incomes abroad. d. A technological development that decreases the cost of producing computer chips.
The Court will block proposed horizontal and vertical mergers when
a. there are many firms in the market b. economies of scale exist c. junk bonds are involved d. the stock market is doing poorly e. high market concentration already exists