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When the Interest Rate on a Bond Is Above the Equilibrium

question 104

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When the interest rate on a bond is above the equilibrium interest rate,in the bond market there is excess ________ and the interest rate will ________.


Definitions:

Socialist System of Economy

An economic system where the means of production are owned and controlled by the state or public, aiming for equal distribution of wealth and resources.

Discount Sale

A sales promotion technique where products or services are sold at a price lower than their original price to stimulate demand.

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