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Behavior of Interest rate Flashcards | StudBud
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Behavior of Interest rate
Behavior of Interest rate
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1
When the price of a bond is above the equilibrium price, there is an excess ________ bonds and price will ________.
supply of; rise
supply of; fall
demand for; rise
demand for; fall
2
The demand for Picasso paintings rises (holding everything else equal) when
C. Treasury securities become riskier.
D. people expect gold prices to rise.
B. people expect a boom in real estate prices.
A. stocks become easier to sell.
3
Picture
A. reduce; financial
B. reduce; real
D. raise; real
C. raise; financial
4
You would be less willing to purchase Treasury bonds, other things equal, if
A. you inherit $1 million from your Uncle.
D. stock prices are expected to fall.
C. gold becomes more liquid.
B. you expect interest rates to fall.
5
Pieces of property that serve as a store of value are called
units of account.
liabilities.
assets.
borrowings
6
When interest rate of bond is above the equilibrium interest rate, there is excess ________,interest rate will ________.
demand; rise
demand; fall
supply; rise
supply; fall
7
In the bond market, the bond demanders are the ________ and the bond suppliers are the ________.
C. borrowers; lenders
A. lenders; borrowers
B. lenders; advancers
D. borrowers; advancers
8
In the bond market, the bond demanders are the ________ and the bond suppliers are the ________.
lenders; advancers
borrowers; lenders
lenders; borrowers
borrowers; advancers
9
Picture
D. decrease; increase
B. increase; decrease
A. increase; increase
C. decrease; decrease
10
Picture
C. decreases; decreases
D. decreases; increases
B. increases; decreases
A. increases; increases
11
A movement along the bond demand or supply curve occurs when ________ changes.
C. wealth
A. bond price
D. expected return
B. income
12
The demand for silver decreases, other things equal, when
C. wealth grows rapidly.
B. the market for silver becomes more liquid.
D. interest rates are expected to rise.
A. the gold market is expected to boom.
13
Picture
A. rises; right
D. falls; left
C. falls; right
B. rises; left
14
Picture
A. increases
B. decreases
D. erases
C. has no effect on
15
Picture
B. expected returns
A. wealth
C. risk
D. liquidity
