Use the figure below to answer the following questions.

Figure 24.5.2
-Refer to Figure 24.5.2. Which one of the following best describes the response to a rise in the market price of bonds?
A)A movement from A to B
B)A movement from A to C
C)A movement from A to F
D)A movement from A to E
E)A movement from C to A

Question

Use the figure below to answer the following questions.
  
Figure 24.5.2
-Refer to Figure 24.5.2. Which one of the following best describes the response to a rise in the market price of bonds?
A)A movement from A to B 
B)A movement from A to C 
C)A movement from A to F 
D)A movement from A to E 
E)A movement from C to A

Quizplus · Accepted Answer

As the market price of bonds rises, the yield or return on bonds decreases, making them less attractive to investors. This leads to a movement along the demand curve for bonds from point A to point C, indicating a decrease in quantity demanded of bonds.

Use the Figure Below to Answer the Following Questions