Table 12.1Year 1Year 2Price of bond$2,000$1,800Interest payment$ 200$200Refer to Table 12.1. Between year 1 and year 2, the interest rate on the bonddecreased by 1 percentage point.券decreascd by 10 percentage points.increased by 1 pcrcentage point.O increased by 10 pcrcentage points.

Interest rate in bonds is percentage change of interest amount of both the years

Table 12.1 Year 1 Year 2 Price of bond $2,000 $1,800 Interest payment $ 200 $200 Refer to Table 12.1. Between year 1 and year 2, the interest rate on the bond O decreased by 1 percentage point. decreased by 10 percentage points. increased by 1 percentage point. Oincreased by 10 percentage points.

Table 12.1 Year 1 Year 2 Price of bond $2,000 $1,800 Interest payment $ 200 $200 Refer to Table 12.1. Between year 1 and year 2, the interest rate on the bond O decreased by 1 percentage point. decreased by 10 percentage points. increased by 1 percentage point. Oincreased by 10 percentage points.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Table 12.1
Year 1
Year 2
Price of bond
$2,000
$1,800
Interest payment
$ 200
$200
Refer to Table 12.1. Between year 1 and year 2, the interest rate on the bond
decreased by 1 percentage point.
券
decreascd by 10 percentage points.
increased by 1 pcrcentage point.
O increased by 10 pcrcentage points.

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