The Figure Given Below Shows the Demand [D and D']

question 26

Multiple Choice

The figure given below shows the demand [D and D'] and supply [S and S'] curves of shares of stock.Figure 17.2

-If bonds and stocks are considered to be substitute goods, and the investors expect stock prices to drop in the near future, _____.

• A)the price of bonds will also decline
• B)the supply of bonds will increase
• C)the interest rate on bonds will decline
• D)the demand for stocks will increase
• E)the demand for bonds will decline

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Definitions:

Talent

Natural aptitude or skill.

Projection

A psychological defense mechanism where individuals attribute their own unacceptable thoughts and feelings to others.

Inadequacies

The state or quality of being insufficient or not meeting the required standards.

Blaming

Assigning responsibility for a fault or wrong to someone else.