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When the Supply of Bonds Increases

Question 88

Multiple Choice
When the supply of bonds increases,

When the supply of bonds increases,


A) bond prices fall, causing the current interest rate to rise.
B) bond prices fall, causing the current interest rate to decline.
C) bond prices rise, causing the current interest rate to rise.
D) bond prices rise, causing the current interest rate to decline.
E) both bond prices and annual interest payments fall, causing the current interest rate to remain unchanged.

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