Banks hold capital because
A) they are required to by regulatory authorities.
B) higher capital increases the returns to the owners.
C) it increases the likelihood of bankruptcy.
D) higher capital increases the return on equity.
A
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Mutual funds that allow shares to be redeemed at any time at a price that is tied to the asset value of the fund are known as
A) close-end funds. B) open-end funds. C) asset-value funds. D) redeemable funds.
Statistical studies in the United States have reached the conclusion that for low-income workers
a. the substitution effect is greater than the income effect. b. the income effect is greater than the substitution effect. c. the income effect is about equal to the substitution effect. d. the substitution effect is of the "wrong" sign.
When inflation is less than anticipated inflation,
What will be an ideal response?
In general does international diversification benefit investors?
A) yes, because it allows them to diversify their risk across many countries B) no, because it creates the additional problem of country risk C) yes, because it enables much greater profits through arbitrage opportunities D) no, because it subjects them to legal regulation in additional markets