Compared to Short-Term Bonds,other Things the Same,long-Term Bonds Generally Have

question 94

Multiple Choice

Compared to short-term bonds,other things the same,long-term bonds generally have

• A)more risk and so they pay higher interest rates.
• B)less risk and so they pay lower interest rates.
• C)less risk and so they pay higher interest rates.
• D)about the same risk and so they pay about the same interest rate.

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Definitions:

Minimum Imposed Price

A price floor set by the government or other regulatory body, above the equilibrium price, to prevent prices from falling too low.

Consumer Surplus

The difference between what consumers are willing to pay for a good or service and what they actually pay, representing a measure of consumer satisfaction.

Producer Surplus

The difference between what producers are willing to accept for a good and the actual amount they receive.

Minimum Imposed Price

A price floor set by the government or an agency, below which the price of a product cannot legally fall.