The Demand Curve for Bonds Would Be Shifted to the Left

question 36

Multiple Choice

The demand curve for bonds would be shifted to the left by an

• A)increase in wealth.
• B)increase in expected returns on bonds.
• C)increase in expected inflation.
• D)increase in the liquidity of bonds relative to other assets.

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Definitions:

Common Stock

A type of security that signifies ownership in a corporation, entitling the shareholder to a share of the corporation's profits and assets.

Consolidated Earnings Per Share

A calculation of the earnings per share of a parent company and its subsidiaries, providing a measure of the combined profitability on a per-share basis.

Convertible Securities

Convertible securities are financial instruments, like bonds or preferred stocks, that can be converted into a predetermined number of the issuer's equity shares.

Subsidiary

A company that is completely or partly owned and partly or wholly controlled by another company, known as the parent company.