10. Which of the fsilowing statements) is(are true? The real rate of intenest is delemined by the supply and denand for funds The real rate of interest is determined by the epected rate of infation The real rate of inerest can be aflected by actions of the Fed The real rate of interest is equal to the nominal interest ae plus te epected cate of ination Alandll only and l only only D.and ELILand IV only 11. Which of the folowing statements is true A Infation has no efect on the nominal rate of interest B.The nealized nominal rate of interest is always greater than the al nteet Page 13 C. Cenicates of deposit offer a guaanteed al rate of inres D. Cenficates of deposit offer a guaranteed nominal rate of interest E Infaton has no efect on the nominal ate of interest the aied nominal e dtstsalays greater than the real ate of interest, and cenficaes of depost offer a garateed al ae of intenest 120eer things equa an inoase in the goenment budget delic A drives the interest rate down B drives the interest rate up C. might net have any effect on interest saes D. always increases business prospects E never inoeases business prospects 13. Ceteris parbus, a decrease in the demand for loanable funds A drives the interest rate down drives the interest rate up ton inter peds s prospedts and a inarease in the level of savings 14. The holding petod return (HPR) on a sham of stock is equal to A the captal gain yield duing the petiod, plus the infation rate B. the capital gain yield during the period. plus the dividend yleid C the unt yeld plus the dividend yield D. he dividend yeld plus the risk premun E. the change in stock price 15 Historical reconds regarding netum on stocks, Treasury bands. and Treasury bils between 1925 and 2009 show that A stocks offered investors greater aes of neum tan bonds and bis B stock retuns were less volatile than those of bonds and bls C. bonds offered investors greater rates of retum than stocks and bills D. bils outpeomed stocks and bonds Etreasury bills always offered a rate of retum greater than infation 16. the interest rate paid by borrowers and the iterest rate reaeived by savers accuraly eect te realzed ae of infation A bomouers gain and savers lose B savers gain and bemowers lose. C. both borrowers and savers lose D. nether bomowers nor savers gin or lose E. both boowers and savers gain You have been given this probabity distbution for the holding-period wm brk Page 1 17. What is the expeced holding-geriod retum for KP stodak A 10 40% B.932% C. 11.63% D. 11.54% E 1088%
