A bond buyer is a
a. saver. Long term bonds have less risk than short term bonds.
b. saver. Long term bonds have more risk than short term bonds.
c. borrower. Long term bonds have less risk than short term bonds.
d. borrower. Long term bonds have more risk than short term bonds.
b
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If knowledge possessed by one party in a financial transaction is not known to the other party, ________ exists
A) fraud B) asymmetric information C) disintermediation D) no financial intermediation
Refer to the production possibility graph above. Assume that the economy is in equilibrium at point e. If the price of good B increases, the new equilibrium is most likely to be
A) point f. B) point d. C) point e. D) point h. E) point b.
If money supply and money demand both increased:
a. nominal interest rates would increase and investment would increase b. nominal interest rates would increase and investment would decrease. c. nominal interest rates would decrease and investment would increase. d. the change in nominal interest rates and investment would be indeterminate.
Monopoly pricing prevents some mutually beneficial trades from taking place. These unrealized, mutually beneficial trades are
a. less of a concern for a monopoly than competitive market. b. offset by the higher profits earned by a monopolist. c. a function of the reduction in the quantity produced by a monopolist in comparison to a competitive market. d. All of the above are correct.