Refer to the Above Figure

question 51

Multiple Choice

Refer to the above figure.If box D represents the product market and flow (6) represents consumption expenditures,then box C is:

• A) households,flow (7)is revenue,and flow (8)is goods and services.
• B) businesses,flow (7)is revenue,and flow (8)is goods and services.
• C) households,flow (7)is goods and services,and flow (8)is revenue.
• D) businesses,flow (7)is goods and services,and flow (8)is revenue.

---

Definitions:

Yield To Call (YTC)

The rate of interest earned on a bond if it is called. If current interest rates are well below an outstanding callable bond’s coupon rate, the YTC may be a more relevant estimate of expected return than the yield to maturity, since the bond is likely to be called.

Yield To Maturity (YTM)

The total return anticipated on a bond if the bond is held until its maturity date, taking into account both interest payments and the difference between the bond's current market price and its face value.

Annual Coupon Rate

A bond's yearly interest payment to its holders, expressed as a percentage of the bond's face value.

Maturity

The specified time at which the principal amount of a bond or loan is due to be paid back to the lender.