Secondary financial markets:
A. are financial markets where existing securities are bought and sold.
B. are financial markets for all financial instruments rated less than investment grade.
C. are only for stock.
D. eliminate the transaction costs for buyers and sellers.
Answer: A
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What is the difference between average total cost and marginal cost and are they ever equal to each other?
What will be an ideal response?
Crowding out refers to the government's increased demand for credit, which:
a. displaces some private sector consumption by decreasing the price level. b. displaces some private sector borrowing by decreasing the interest rate. c. displaces some private sector borrowing by increasing the interest rate. d. hires labor away from the private sector e. displaces some import purchases by the private sector.
The marginal revenue product curve of a factor is negatively sloped because:
a. the additional revenue generated from an additional unit of a factor remains constant as more resources are hired. b. the additional revenue generated from an additional unit of a factor declines as more resources are hired. c. the additional revenue generated from an additional unit of a factor usually becomes zero as more resources are hired. d. the additional revenue generated from an additional unit of a factor increases as more resources are hired. e. the additional revenue generated from an additional unit of a factor doubles every time new resources are hired.
Which of the following statements is true with respect to a tariff on imported cheese?
a. It lowers the price of cheese. b. It lowers domestic cheese producers' profit. c. It creates tax revenues for the government. d. It cannot result in retaliation. e. It increases the amount of foreign cheese sold on domestic markets.