Question #350079

**24. **The demand curve and supply curve for one-year discount

bonds with a face value of $1,000 are represented by the

following equations:

*Bd *: Price = -0.8 * Quantity + 1100

*Bs *: Price = Quantity + 680

**a. **What is the expected equilibrium price and quantity

of bonds in this market?

**b. **Given your answer to part (a), what is the expected

interest rate in this market?

Expert's answer

"\\begin{cases}\n P=-0.8Q+1100, \\\\\n P=Q+680;\n\\end{cases}"

"-0.8Q+1100=Q+680,"

"1.8Q=420,"

"Q=233,"

"P=913."

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LERATO RAMONYAI05.04.23, 10:26True

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