6. You are thinking of buying a bond from Bluestone Corporation. You know that this bond is long term and you knowthat Bluestone's business ventures are risky and uncertain, You then consider another bond with a shorter term to maturityissued by a company with good prospects and an established reputation. Which of the following is correct?a. The longer term would tend to make the interest rate on the bond issued by Bluestone higher, while the higherrisk would tend to make the interest rate lower.b. The longer term would tend to make the interest rate on the bond issued by Bluestone lower, while the higherrisk would tend to make the interest rate higher.c. Both the longer term and the higher risk would tend to make the interest rate lower on the bond issued byBluestone.d. Both the longer term and the higher risk would tend to make the interest rate higher on the bond issued byBluestone.7. The unemployment rate is computed as the number of unemployeda. divided by the labor force, all times 100.b. divided by the number of employed, all times 100.c. divided by the adult population, all times 100.d. times the labor-force participation rate, all times 100.8. Who of the following is not included in the Bureau of Labor Statistics' "employed" category?a. Those who worked in their own businessb. Those who worked as unpaid workers in a family member's businessc. Those waiting to be recalled to a job from which they had been laid offd. Those who were temporarily absent from work because of vacation9. Suppose that the adult population in the country of Atlantis is 130 million. If 100 million people are employed and 7million are unemployed, thena. 23 million are not in the labor force.b. 23 million are in the labor force.c. 123 million are in the labor force.d. 93 million are not in the labor force.10. Minimum wages create unemployment in markets where they create aa. shortage of labor. Unemployment of this type is called frictional.b. shortage of labor. Unemployment of this type is called structural.c. surplus of labor. Unemployment of this type is called frictional.d. surplus of labor. Unemployment of this type is called structural.11. Which of the following best represents fiat money?a. The eurob. A gold barc. Monopoly moneyd. Baseball cards

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6. You are thinking of buying a bond from Bluestone Corporation. You know that this bond is long term and you know that Bluestone's business ventures are risky and uncertain. You then consider another bond with a shorter term to maturity issued by a company with good prospects and an established reputation. Which of the following is correct? a. The longer term would tend to make the interest rate on the bond issued by Bluestone higher, while the higher risk would tend to make the interest rate lower. b. The longer term would tend to make the interest rate on the bond issued by Bluestone lower, while the higher risk would tend to make the interest rate higher. c. Both the longer term and the higher risk would tend to make the interest rate lower on the bond issued by Bluestone. d. Both the longer term and the higher risk would tend to make the interest rate higher on the bond issued by Bluestone.

6. You are thinking of buying a bond from Bluestone Corporation. You know that this bond is long term and you know that Bluestone's business ventures are risky and uncertain. You then consider another bond with a shorter term to maturity issued by a company with good prospects and an established reputation. Which of the following is correct? a. The longer term would tend to make the interest rate on the bond issued by Bluestone higher, while the higher risk would tend to make the interest rate lower. b. The longer term would tend to make the interest rate on the bond issued by Bluestone lower, while the higher risk would tend to make the interest rate higher. c. Both the longer term and the higher risk would tend to make the interest rate lower on the bond issued by Bluestone. d. Both the longer term and the higher risk would tend to make the interest rate higher on the bond issued by Bluestone.

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter4: Bond Valuation

Section: Chapter Questions

Problem 4Q: If you buy a callable bond and interest rates decline, will the value of your bond rise by as much...

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