The Twin Perils of the Modern Macro Economy Are Said

question 118

Multiple Choice

The twin perils of the modern macro economy are said to be

• A) government and the trade deficit.
• B) unemployment and the trade surplus.
• C) inflation and unemployment.
• D) inflation and the trade deficit.

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Definitions:

Yield To Maturity

The total return anticipated on a bond if the bond is held until its maturity date, taking into account its current market price, face value, interest rate, and time to maturity.

Par Value

Is the face value of a bond or stock, representing the amount that will be returned to the investor at maturity or the value at which the stock is noted on the balance sheet.

Default Risk Premiums

The additional yield that investors demand for holding a bond that has a risk of default over a risk-free security.