Question

... mocy uemand curve and a lettward shift in the money supply curve C) a leftward shift in the money demand curve and a rightward shift in the money supply curve. D) a rightward shift in the money demand curve and a rightward shift in the money supply curve E) none of the above ******74) Suppose a one-year discount bond offers to pay $100 in one year and currently sells for $99. Given this information, we know that the interest rate on the bond is A) 11.1% B) 10%. C) 5.3% D) 9.9% 75) Which of the following is an asset of a central bank? A) currency B) bonds C) reserves D) none of the above 76) Which of the following is an asset for both a bank and a central bank? A) currency B) deposits C) bonds D) all of the above F) none of the above ИХ

# 74

Answer 1

F = P * (1+I)^t

Here F = 100

P = 99

t = 1 yr

I = F / P -1 = 100 / 99 - 1 = 1.0101 - 1 = 0.0101 = 1.01%

All the given are wrong.