An Increase in the Liquidity of Corporate Bonds Will ________

question 51

Multiple Choice

An increase in the liquidity of corporate bonds will ________ the price of corporate bonds and ________ the interest rate on those corporate bonds, everything else held constant.

• A) increase; increase
• B) reduce; reduce
• C) increase; reduce
• D) reduce; increase

---

Definitions:

Causal Agent

A factor that is directly responsible for causing a certain outcome or condition, often used in the context of diseases or environmental changes.

Bile

The fluid secreted by the liver; emulsifies fats.

Gallbladder

A small organ located beneath the liver that stores and concentrates bile, a digestive enzyme produced by the liver.

Liver

A large, complex organ that secretes bile, helps maintain homeostasis by removing or adding nutrients to the blood, and performs many other metabolic functions.