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      Question

      Consider the following: Statement 1: There exists

      an inverse relationship between market rates of interest and price of bond Statement 2: The liquidity trap is a situation when at some very low rate of interest all asset holders become bears
      A both are incorrect Correct Answer Incorrect Answer
      B both are correct Correct Answer Incorrect Answer
      C statement one is correct and two is not correct Correct Answer Incorrect Answer
      D statement one is incorrect and two is correct Correct Answer Incorrect Answer

      Solution

      Both the statements are correct

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