If You Initially Pay $1,000 for a Bond with an Annual

question 263

Multiple Choice

If you initially pay $1,000 for a bond with an annual interest rate of 5 percent, but then the market interest rate rises to 6 percent,

• A) the market price of the bond is still $1,000.
• B) the bond's annual interest payment remains equal to $50.
• C) the market price of the bond has increased.
• D) the market price of the bond has decreased.

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Definitions:

Anal Stage

A phase in Freud's psychosexual development theory occurring in early childhood, where pleasure centers on controlling bladder and bowel movements.

Developmental Theory

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A method of gathering information from individuals, usually by asking a series of questions to collect data on various topics.

Comparison Group

A group in a study that does not receive the experimental treatment and is used as a benchmark to measure the effect of the treatment.