Everything Else Being Equal,a ________ Bond's Price Will ________ as the Bond

question 3

Multiple Choice

Everything else being equal,a ________ bond's price will ________ as the bond approaches maturity.

• A) premium; remain the same
• B) discount; decrease
• C) discount; increase
• D) discount; remain the same
• E) premium; increase

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Definitions:

Maximize Profits

Maximizing profits is the primary goal of most firms and involves strategies and decisions aimed at increasing the difference between total revenues and total costs.

Nondiscriminating Pure Monopolist

A monopolist that charges all consumers the same price for its product, despite potential differences in the market.

Pure Monopolist

A single supplier in a market that controls all the supply of a particular good or service, with no close substitutes available, allowing for the setting of prices.

Profit-Maximizing

The procedure through which a corporation decides on the price and the amount of production that yields the most profit.