The value of future payments is affected by

1. The probability of nonpayment.

2. Capital gains.

3. The par value.

4. The level of dividends.

If the expected rate of return decreases

1. The time value of money will increase.

2. The demand for loanable funds will decrease.

3 Market participants will save less money.

4. The demand for loanable funds will increase.

Financial intermediaries make the allocation of resources more efficient by

a. Spreading risk out over many individuals.

d.Transferring purchasing power from savers to dissavers.

c. Lending or investing the savings they hold.

d. Reducing search and information costs for savers and investors.

As the price of an existing bond increases,

a) The current yield decreases.

b) The par value decreases.

c) The coupon rate decreases.

d) There is increased risk that the U.S. Treasury will default on the bond.

Bonds may be issued by the U.S.

a) Immigration and Naturalization Agency.

b) Congress.

c) Treasury.

d) Federal Reserve Bank.