We would expect the interest rate on Bond A to be higher than the interest rate on Bond B if the two bonds have identical characteristics except that
a. Bond A was issued by a financially weak corporation and Bond B was issued by a financially strong corporation.
b. Bond A was issued by the Exxon Mobil Corporation and Bond B was issued by the state of New York.
c. Bond A has a term of 20 years and Bond B has a term of 1 year.
d. All of the above are correct.
d
You might also like to view...
If tolls on a toll road can be raised significantly before commuters will consider using a free alternative, then an increase in tolls will result in
A) an increase in total revenue. B) a decrease in total revenue. C) a decrease in non-toll road usage. D) an increase in toll road usage.
A decrease in the price level results in a(n) ________ in household consumption spending and a(n) ________ in investment spending
A) increase; increase B) decrease; increase C) increase; decrease D) decrease; decrease