The Period of Time Over Which the Firm Can Vary

question 4

Multiple Choice

The period of time over which the firm can vary its technology of production is the

• A)very-short run.
• B)short run.
• C)long run.
• D)very-long run.
• E)none of the above; technology cannot be varied.

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Definitions:

Coupon Rate

The annual interest rate paid on a bond's face value to its holders, expressed as a percentage of the face value.

Duration

Measures the sensitivity of a bond's price to changes in interest rates, calculated as a weighted average of the times until the bond's cash flows are received.

Yield To Maturity

The total return anticipated on a bond if the bond is held until its maturity date, including all interest payments and the repayment of principal.

Coupon Rate

The interest rate that a bond issuer will pay to a bondholder, typically expressed as an annual percentage of the bond's face value.