Answer:
C. What you earn on this security would not change as a result of the change in interest rates.
Explanation:
The increase in the interest rate will decrease the price of the T-Bill if you want to sell it to another investor, but what you will earn with the security will not change at all. Your earnings in dollars = interest rate paid by the T-Bill or any other type of bond.
If you buy and sell securities for a living, then a change in the interest rates can make you win or lose money, since the price of the securities will increase or decrease. If interest rates increase, the price decreases. But if you invest on a security to earn the coupon or interest rate that it pays, a change in the price will not affect you because you already own it. The opportunity cost of holding the security might change, but the accounting revenues will not.
Answer:
C
Explanation:
Trade off can be expressed in terms of opportunity cost.
Opportunity cost or implicit is the cost of the option forgone when one alternative is chosen over other alternatives.
Kyoko has limited time so she has to choose between three activities. If she chooses one sport, she would not be able to partake in the other activities. So, she is trading off biking or running for swimming.
Trade off occurs because resources are limited and wants are unlimited.
It is/was at war, it doesn't have the kind of financial sustenance you need.
