The ratio of equity to total assets is a measure of a bank's __________ risk
A) credit
B) leverage
C) interest rate
D) liquidity
B
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Which of the following statements correctly identifies a reason why inflation can be used as a countercyclical policy tool?
A) Inflation sometimes increases the demand for workers that increases output and helps combat slowdowns. B) Inflation reduces money costs and hence stimulates an economy during slowdowns. C) Inflation increases consumer demand which is necessary for combating slowdowns. D) Inflation increases consumer confidence, which is an absolute necessity to counter act business cycles.
Trade among nations is ultimately based on
a. absolute advantage. b. strategic advantage. c. comparative advantage. d. technical advantage.
A possible reason a nation might impose a protectionist policy such as a tariff is to:
A. increase the level of imports. B. protect an infant industry from foreign competitors. C. encourage specialization in the good in which the nation has a comparative advantage. D. slow domestic production.
All of the following are barriers to entry in an industry EXCEPT
A. governmental restrictions. B. economies of scale. C. a patent. D. low marginal tax rates.