ECO4223 EXAM 2: QUESTIONS WITH COMPLETE SOLUTIONS (100% CORRECT)

ECO4223 EXAM 2: QUESTIONS WITH COMPLETE SOLUTIONS (100% CORRECT)
Question : During a recession, the supply of
bonds______, and the supply curve shifts to
the___________, everything else held constant.
a. increases; right
b. decreases; left
c. increases; left
d. decreases; right
CORRECT ANSWER: decreases; left
Question : In the bond market, the market equilibrium
shows the market-clearing ________ and market-clearing
________.'
a. price; interest rate
b. price; deposit
c. interest rate; premium
d. interest rate; deposit

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