If There Is an Excess Supply of Bonds at a Given

question 27

Multiple Choice

If there is an excess supply of bonds at a given price of bonds, then

• A)the interest rate will fall.
• B)the interest rate will rise.
• C)the price of bonds will fall.
• D)the interest rate may rise or the interest rate may fall depending upon the reasons for the excess demand for bonds.

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Definitions:

Irrevocable

Not able to be changed, reversed, or recovered; final and unalterable.

Renunciation

The act of formally or officially giving up a right, position, or responsibility, often in a legal or ceremonial context.

Statutory Right

A right granted by legislation, which is enacted by a legislative body.

Intestate

The state of dying without having made a legal will, leading to the distribution of one's estate according to state or country laws.