This paperwork of ECO 316 Week 1 Chapter 4 Interest Rates and Rates of Return consists of:
4.1 Multiple Choice Questions
1) When you place your funds in a savings account at a bank, those funds are
2) Debt instruments are also called
3) A debt instrument represents
4) Simple loans and discount bonds differ from coupon bonds and fixed-payment loans in that
5) Issuers of coupon bonds
6) A simple loan involves
7) The amount of funds the borrower receives from the lender with a simple loan is called the
8) The total payment to a lender for a simple loan is
9) Suppose First National Bank makes a one-year simple loan of $1,000 at 7% interest to Harry's Restaurant. At the end of one year Harry's Restaurant will pay First National
10) Suppose First National Bank makes a one-year simple loan of $1000 to Harry's Restaurant. If at the end of one year Harry's Restaurant pays First National $1400, then the interest rate on this loan must have been
11) The most common type of simple loan is a(an)
12) A discount bond resembles a simple loan in that
13) A discount bond involves
14) Which of the following is NOT a discount bond?
15) Suppose Matt's Cars issues a one-year discount bond with a face value of $10,000, and received $9259, repaying $10,000 after one year. The interest rate on this bond would be
16) Suppose Matt's Cars issues a discount bond with a face value of $10,000 payable in one year with an interest rate of 4%. How much will Acme
