Everything else held constant,when bonds become less widely traded,and as a consequence the market becomes less liquid,the demand curve for bonds shifts to the ________ and the interest rate ________.
A)right;rises
B)right;falls
C)left;falls
D)left;rises

Question

Quizplus · Accepted Answer

When bonds become less widely traded and the market becomes less liquid, the demand for those bonds decreases, shifting the demand curve to the left. This decrease in demand typically leads to an increase in interest rates as sellers have to offer higher returns to entice buyers.

Everything Else Held Constant,when Bonds Become Less Widely Traded,and as a Consequence