Multiple Choice
Based on our understanding of the determinants of the interest rate and bond prices, we know that a decrease in income will cause:
A) A decrease in bond prices and an increase in i.
B) An increase in bond prices and an increase in the interest rate (i) .
C) No change in bond prices and a decrease in i.
D) An increase in bond prices and a decrease in i.
E) A decrease in bond prices and a decrease in i.
Correct Answer:
Verified
Correct Answer:
Verified
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