The Law of Demand Implies That If Nothing Else Changes

question 308

Multiple Choice

The law of demand implies that if nothing else changes, there is

• A) a positive relationship between the price of a good and the quantity demanded.
• B) a negative relationship between the price of a good and the quantity demanded.
• C) a linear relationship between price of a good and the quantity demanded.
• D) an exponential relationship between price of a good and the quantity demanded.

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Definitions:

Gain or Loss

The financial result from selling an asset for more or less than its purchase price.

Par Value

The nominal or face value of a bond, stock, or coupon as stated by the issuer, which is typically not related to its market value.

Unamortized Premium

The portion of a bond premium that has not yet been amortized or recognized in the financial statements over time.

Par Value

The face value of a bond or stock, as specified by the issuing company, which is the minimum price at which the securities can be issued initially.