Assume that you purchased a 1,000 perpetual bond and the interest ...

[yoroshambo]

Assume that you purchased a 1,000 perpetual bond and the interest rate on that bond declined from 5 percent to 2 percent. Thus,
 
  a. the bond price increased by 1,500.
  b. you could sell this bond at a capital gain.
  c. if this was anticipated, the speculative demand for money fell.
  d. All of the above
  e. None of the above

Question 2

According to the new classical theory, a monetary surprise will
 
  a. shift the labor supply curve to the right in the short run.
  b. shift the labor supply curve to the left in the short run.
  c. not shift the labor supply curve in the short run.
  d. shift the aggregate supply curve to the left in the short run.
  e. shift the aggregate supply curve to the right in the short run.

[jomama]

Answer to Question 1

D

Answer to Question 2

C