If There Is an Excess Demand for Bonds at a Given

question 31

Multiple Choice

If there is an excess demand for 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:

Currency

A system of money in general use in a particular country, representing the medium of exchange for goods and services.

Check Register

A place for recording important information about each transaction.

Cash Balance

The amount of cash on hand or in a bank account that is immediately available for use.

Deposit

A deposit is a sum of money placed in an account or given to a party as security for the fulfillment of a contract, often refundable after certain conditions are met.