The Return on Bonds Rises Relative to Other Assets, in the Bond

question 121

Multiple Choice

The return on bonds rises relative to other assets, in the bond market this will result in:

• A) the price of bonds falling and the yields increasing.
• B) a rightward shift in the bond supply curve.
• C) a shift to the left of the bond demand curve.
• D) an increase in bond prices.

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Definitions:

Utility Function

A mathematical representation that captures the preference ranking of various bundles of goods by an individual, translating these preferences into a level of utility or satisfaction.

Income

Refers to the money received, typically on a regular basis, for work or through investments.

Price

The amount of money required to purchase a good or service.

Price

The amount of money required to purchase a good or service, often determined by factors like demand, supply, and market competition.