The leverage ratio of an investment firm refers to
a. the ratio of its investment holdings relative to its vault cash.
b. the ratio of its investment holdings relative to its capital.
c. the percentage of deposits held by the firm relative to its deposits with Federal Reserve banks.
d. the percentage of down payments made to the investment firm relative to the size of mortgages issued by the firm.
B
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The tradeoff for monetary policy represented by the Phillips curve is
a. lower inflation for lower output. b. lower inflation for higher unemployment. c. lower inflation for higher employment. d. higher expected inflation for higher output. e. none of the above.
Michelle Martelle, CEO of Michelle Enterprises, has five projects in hand and is considering which, if any, to undertake. Their expected returns are: project A = 12 percent, project B = 7 percent, project C = 10 percent, project D = 9 percent, and project E = 8 percent. If the interest rate is 8.5 percent, which, if any, investment projects will she accept?
a. Only project A. b. Projects A and C. c. Projects A, C and D. d. Projects A, C, D and E. e. Projects A, B, C, D and E.
When Mark recruits a new motor mechanic in his car repair and service workshop, the number of cars serviced in a day increases by five. If the number of servicing orders received by Mark remains the same, it implies that:
a. the marginal physical product of the new motor mechanic is five. b. the marginal revenue product of the new motor mechanic is zero. c. the marginal revenue product of the new motor mechanic is five. d. the marginal physical product of the new motor mechanic is zero.
Which of the following is most likely to reduce the nominal market wage in a job category?
a. The job requires employees to work the night shift from 11 p.m. to 7 a.m. b. The job is prestigious, and the work is quite interesting. c. The job is widely viewed as dangerous. d. The job requires employees to move from city to city quite often.