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Homework: Chapter 4 Homework Score: 0.5 of 1 pt End of Chapter 3.1 Briefly explain what typically happens to interest rates during a recession. Use a demand and supply graph for bonds to illustrate your answer. A. The demand for bonds increases, while the supply of bonds decreases, resulting in a lower equilibrium interest rate. B. The demand for bonds increases, while the supply of bonds increases by a greater magnitude than demand, resulting in a higher equilibrium interest rate. C. The demand for bonds decreases, while the supply of bonds increases, resulting in a higher equilibrium interest rate. D. The demand for bonds decreases, while the supply of bonds decreases by a greater magnitude than demand, resulting in a lower equilibrium interest rate. Show your answer on the graph 1) Using the drawing tool, draw a new demand curve and supply curve. Properly label your curves. 2) Using the point drawing tool, indicate the equilibrium interest rate. Label your point $E_2$ Carefully follow the instructions above, and only draw the required objects.

          Homework: Chapter 4 Homework
Score: 0.5 of 1 pt
End of Chapter 3.1
Briefly explain what typically happens to interest rates during a recession. Use a demand and supply graph for
bonds to illustrate your answer.
A. The demand for bonds increases, while the supply of bonds decreases, resulting in a lower equilibrium
interest rate.
B. The demand for bonds increases, while the supply of bonds increases by a greater magnitude than
demand, resulting in a higher equilibrium interest rate.
C. The demand for bonds decreases, while the supply of bonds increases, resulting in a higher equilibrium
interest rate.
D. The demand for bonds decreases, while the supply of bonds decreases by a greater magnitude than
demand, resulting in a lower equilibrium interest rate.
Show your answer on the graph
1) Using the drawing tool, draw a new demand curve and supply curve. Properly label your curves.
2) Using the point drawing tool, indicate the equilibrium interest rate. Label your point $E_2$
Carefully follow the instructions above, and only draw the required objects.

Homework: Chapter 4 Homework
Score: 0.5 of 1 pt
End of Chapter 3.1
Briefly explain what typically happens to interest rates during a recession. Use a demand and supply graph for
bonds to illustrate your answer.
A. The demand for bonds increases, while the supply of bonds decreases, resulting in a lower equilibrium
interest rate.
B. The demand for bonds increases, while the supply of bonds increases by a greater magnitude than
demand, resulting in a higher equilibrium interest rate.
C. The demand for bonds decreases, while the supply of bonds increases, resulting in a higher equilibrium
interest rate.
D. The demand for bonds decreases, while the supply of bonds decreases by a greater magnitude than
demand, resulting in a lower equilibrium interest rate.
Show your answer on the graph
1) Using the drawing tool, draw a new demand curve and supply curve. Properly label your curves.
2) Using the point drawing tool, indicate the equilibrium interest rate. Label your point E2
Carefully follow the instructions above, and only draw the required objects.

Added by Anna B.

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