Economics (Irwin Economics)
21st Edition
ISBN: 9781259723223
Author: Campbell R. McConnell, Stanley L. Brue, Sean Masaki Flynn Dr.
Publisher: McGraw-Hill Education
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Chapter 18, Problem 1RQ
To determine
Determining land rent with the help of demand – supply model.
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D Question 26
A corporation issues a bond with a par value of $4,800 in one year. Assume that the bond is sold
today for $4,500. What is the interest rate received by the lender?
O 3.33%
O 11.11%
O 6.67%
6.25%
D
Question 27
The U6 unemployment rate includes which individuals that are not included in the U3
unemployment rate?
O government employees
O people who volunteer
O self-employed individuals
O people who are working part-time but want full-time work
O members of the population that are under the age of 16
Interest rate (%)
Supply
Demand
Quantity of financial capital (% of GDP)
Suppose that the graph above represents the market for financial capital in Yemen. How does an increase in the budget
deficit of Yemen affect its equilibrium interest rate?
O A. The equilibrium interest rate decreases since the demand curve for financial capital shifts to the left.
O B. The equilibrium interest rate increases since the demand curve for financial capital shifts to the right.
O C. The equilibrium interest rate increases since the supply curve for financial capital shifts to the left.
O D. The equilibrium interest rate decreases since the supply curve for financial capital shifts to the right.
Paul wants to create a scholarship fund at his alma mater. He wants to provide support for a
scholarship of $10,000 each year, forever. If he gives the school $299,298, what minimum interest
rate must the school earn on the funds to provide the level of support that Paul wants for the college?
2%
34
O 4%
O 5%
O 0 o o
Chapter 18 Solutions
Economics (Irwin Economics)
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