Financial institutions in the u. s. economy.
suppose van would like to invest $2,000 of his savings.
one way of investing is to purchase stock or bonds from a private company.
suppose robotroid, a robotics firm, is selling bonds to raise money for a new lab-a practice known as finance. buying a bond issued by robotroid would give van the firm. in the event that robotroid runs into financial difficulty, will be paid first.
suppose instead van decides to buy 100 shares of robotroid stock.
which of the following statements are correct? check all that apply.
a) an increase in the perceived profitability of robotroid will likely cause the value of van's shares to rise.
b) robotroid earns revenue when van purchases 100 shares, even if he purchases them from an existing shareholder.
c) expectations of a recession that will reduce economywide corporate profits will likely cause the value of van's shares to decline.
alternatively, van could invest by purchasing bonds issued by the u. s. government.
assuming that everything else is equal, a u. s. government bond that matures 10 years from now most likely pays a u. s.government bond that matures 30 years from now. interest rate than a us government bond that matures 30 years from now.