Exam 5: The Behavior of Interest Rates

If prices in the bond market become more volatile, everything else held constant, the demand curve for bonds shifts ________ and interest rates ________.

When the growth rate of the money supply increases, interest rates end up being permanently lower if

If the expected return on bonds increases, all else equal, the demand for bonds increases, the price of bonds ________, and the interest rate ________.

Holding everything else constant, if interest rates are expected to increase, the demand for bonds ________ and the demand curve shifts ________.

The interest rate falls when either the demand for bonds ________ or the supply of bonds ________.

When stock prices become more volatile, the ________ curve for gold shifts right and gold prices ________, everything else held constant.

You would be more willing to buy AT&T bonds (holding everything else constant) if

-In the figure above, the price of bonds would fall from P₂ to P₁ if

If wealth increases, the demand for stocks ________ and that of long-term bonds ________, everything else held constant.

Interest rates increased continuously during the 1970s. The most likely explanation is

Everything else held constant, when prices in the art market become more uncertain,

Everything else held constant, when stock prices become less volatile, the demand curve for bonds shifts to the ________ and the interest rate ________.

Of the four effects on interest rates from an increase in the money supply, the initial effect is, generally, the

Everything else held constant, when stock prices become ________ volatile, the demand curve for bonds shifts to the ________ and the interest rate ________.

The riskiness of an asset is measured by

A return to the gold standard, that is, using gold for money will ________ the ________ for gold, ________ its price, everything else held constant.

If the liquidity effect is smaller than the other effects, and the adjustment to expected inflation is slow, then the

Holding the expected return on bonds constant, an increase in the expected return on common stocks would ________ the demand for bonds, shifting the demand curve to the ________.

The riskiness of an asset that is unique to the particular asset is

When real income ________, the demand curve for money shifts to the ________ and the interest rate ________, everything else held constant.