The following sub-questions are about the properties of the bond market.

a) Due to some technological improvements,Internet trading of stocks increases.Explain the effect of such a change on the bond market.[6 marks]

b) Moe Jones is a presidential candidate. He has an economic program that proposes an introduction ofa "flat tax". Under a flat tax, there would be only one tax bracket for the federal income tax and most tax deductions and tax exemptions would be eliminated. Suppose that Jones wins the 2024 presidential election. What would be the likely impact on the market for municipal bonds? [6 marks]

c) Let us assume that due to some regulation changes all the private bond rating agencies are abolished. What would be the impact on the bond market?[6 marks]