__________ Describes Real Increases in Debt Burdens Caused by Falling

question 1

Multiple Choice

__________ describes real increases in debt burdens caused by falling incomes and prices.

• A)Debt deflation
• B)Debt inflation
• C)Real income depreciation
• D)Real income inflation

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Definitions:

Callable Bonds

A type of bond that can be redeemed by the issuer before its maturity date at a predetermined price.

Call Price

The price at which a bond or a preferred stock can be redeemed by the issuer before its maturity date.

Interest Rates

The price of borrowing money, expressed as a percentage of the amount borrowed, set by lenders as compensation for the risk and the opportunity cost of lending.

Floating-rate Bonds

Bonds with a variable interest rate that adjusts periodically in accordance with a benchmark interest rate or index.