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Question
A pure discount security is an interest-bearing asset that pays:A. interest on a semi-annual basis.
B. interest on an annual basis.
C. a single payment at maturity.
D. no interest.
E. a variable-rate interest.
Answer
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Which one of the following statements regarding an original issue $25,000 GNMA bond is correct?
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Assume the inflation rate in 2012 is 2.1 percent. If the nominal GDP grew 3.2 percent and nominal wages grew 2.6 percent, what are the approximate real growth rates of GDP and wages?
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