Holding the expected return on bonds constant,an increase in the expected return on common stocks would ________ the demand for bonds,shifting the demand curve to the ________.
A)decrease;left
B)decrease;right
C)increase;left
D)increase;right

Question

Quizplus · Accepted Answer

An increase in the expected return on common stocks would make them more attractive to investors, causing them to shift their investments from bonds to stocks. This would decrease the demand for bonds and shift the demand curve to the left.

Holding the Expected Return on Bonds Constant,an Increase in the Expected