1.Interest rates typically rise in booms because the demand for money depends _________ on changes in real income. 2. If interest rates are 12 percent per year, the price of a bond that promises to...

1.Interest rates typically rise in booms because the demand for money depends _________ on changes in real income.

2. If interest rates are 12 percent per year, the price of a bond that promises to pay $100 next year will be equal to _________.

3. Through its effect on money demand, an increase in prices will _________ interest rates.

4. Open market purchases lead to rising bond prices and _________ interest rates.