A Decrease in Swiss Prices Will Cause

question 99

Multiple Choice

A decrease in Swiss prices will cause

• A) an increase in the demand for U.S. dollars and an increase in the exchange rate of Swiss francs per dollar.
• B) a decrease in the demand for U.S. dollars and a decrease in the exchange rate of Swiss francs per dollar.
• C) an increase in the supply of U.S. dollars and a decrease in the exchange rate of Swiss francs per dollar.
• D) a decrease in the supply of U.S. dollars and an increase in the exchange rate of Swiss francs per dollar.

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Definitions:

Call Provision

A clause in a bond or other fixed-income security that allows the issuer to repurchase and retire the debt before its maturity date.

Coupon Rate

The interest rate stated on a bond, which is the percentage of the bond's face value that is paid out annually as interest to the bondholder.

Yield to Maturity

The total return anticipated on a bond if held until it matures, including all coupon payments and the return of the principal amount.

Coupon Rate

The interest rate stated on a bond when issued, which represents the amount of interest the bondholder receives, typically paid annually or semi-annually.