An Externality Is a Cost or Benefit Arising from an Economic

question 75

Multiple Choice

An externality is a cost or benefit arising from an economic activity that falls on

• A)consumers but not producers.
• B)producers but not consumers.
• C)consumers or producers.
• D)someone other than consumers or producers.
• E)none of the above.

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Definitions:

Yield to Maturity

The expected total yield on a bond when held until it reaches its date of maturity.

Semiannual Coupon

Interest payments made to bondholders twice a year.

Yield

The income return on an investment, such as the interest or dividends received, typically expressed as an annual percentage of the investment cost.

Maturity Bond

A bond at the end of its term, at which point the principal amount is due to be paid back to the bondholder.