Firms Supplying Twisty-Ties Decrease the Quantity Supplied of Inputs by 10

question 56

Multiple Choice

Firms supplying twisty-ties decrease the quantity supplied of inputs by 10% when the price decreases by 5%. The price elasticity of supply for twisty-ties is:

• A) 4.0.
• B) 0.4.
• C) 2.0.
• D) 0.2.
• E) 1.0.

---

Definitions:

Yield To Maturity

The total return anticipated on a bond if the bond is held until its maturity date, taking into account its current market price, face value, interest payments, and time to maturity.

Duration

A measure of the sensitivity of a bond's or fixed income portfolio's price to changes in interest rates, expressed in years.

Maturity

Is the expiration date of a financial instrument, at which point the principal (or final interest payment) is repaid to the investors.

Coupon Rate

The interest rate per year on a bond, expressed as a fraction of its face value.