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eldisher07
Guest
1) If interest rates rises, then:
A) the price of fixed-income securities fall.
B) the price of fixed-income securities rise.
C) the coupon on bonds fall.
D) the coupon on bonds rise.
2) You would expect the price of a share of stock to fall, if:
A) the expected dividend of the stock rose.
B) the economy went into recession.
C) the price level were rising.
D) all of the above
3) If a $2,000 bond has a 4% coupon rate, then the coupon payment each period is:
A) $8.
B) $80.
C) $800.
D) $2,000.
4) If interest rates are positive, which of the following has the lowest current value?
A) $100 now
B) $100 a year from now
C) $100 two years from now
D) All of the above have the same current value.
5) Falling stock prices decrease investment because:
A) it decreases firm profits and makes investment out of retained earnings harder.
B) firms can raise less money per share of stock sold.
C) it uses up less capital than those requiring less investment.
D) all of the above
6) Wealth and consumption rise when there is a stock market:
A) boom.
B) crash.
C) split.
D) merger.
7) The implementation lag for monetary policy is shorter than for fiscal policy because:
A) it takes longer for the FED to act than Congress.
B) it takes longer for Congress to act than the FED.
C) fiscal policy changes more quickly affect behavior than monetary policy changes.
D) monetary policy changes affect behavior more quickly than fiscal policy changes
8) During periods of __________ growth and inflationary pressures, the Federal Reserve will likely decrease the money supply to ________ interest rates.
A) slow; increase
B) slow; decrease
C) high; increase
D) high; decrease
9) T/F: If the stock market crashes, then the economy will surely go into a depression.
10) T/F: The implementation lag of fiscal policy is longer because the Fed can act more quickly than Congress.
A) the price of fixed-income securities fall.
B) the price of fixed-income securities rise.
C) the coupon on bonds fall.
D) the coupon on bonds rise.
2) You would expect the price of a share of stock to fall, if:
A) the expected dividend of the stock rose.
B) the economy went into recession.
C) the price level were rising.
D) all of the above
3) If a $2,000 bond has a 4% coupon rate, then the coupon payment each period is:
A) $8.
B) $80.
C) $800.
D) $2,000.
4) If interest rates are positive, which of the following has the lowest current value?
A) $100 now
B) $100 a year from now
C) $100 two years from now
D) All of the above have the same current value.
5) Falling stock prices decrease investment because:
A) it decreases firm profits and makes investment out of retained earnings harder.
B) firms can raise less money per share of stock sold.
C) it uses up less capital than those requiring less investment.
D) all of the above
6) Wealth and consumption rise when there is a stock market:
A) boom.
B) crash.
C) split.
D) merger.
7) The implementation lag for monetary policy is shorter than for fiscal policy because:
A) it takes longer for the FED to act than Congress.
B) it takes longer for Congress to act than the FED.
C) fiscal policy changes more quickly affect behavior than monetary policy changes.
D) monetary policy changes affect behavior more quickly than fiscal policy changes
8) During periods of __________ growth and inflationary pressures, the Federal Reserve will likely decrease the money supply to ________ interest rates.
A) slow; increase
B) slow; decrease
C) high; increase
D) high; decrease
9) T/F: If the stock market crashes, then the economy will surely go into a depression.
10) T/F: The implementation lag of fiscal policy is longer because the Fed can act more quickly than Congress.