Smaller firms tend to rely on financial intermediaries instead of financial markets for external financing due to
A) transactions costs.
B) adverse selection.
C) moral hazard.
D) all of the above.
D
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What will be an ideal response?
A catering company is producing at a point where its marginal costs are $25 and its fixed costs are $5000 . At the current price of $10 it is producing 50 meals. If the demand goes up, such that they can now charge $20 per meal, how much should the firm now produce?
a. 60 meals b. 70 meals c. 80 meals d. None, they should shut down
The consumption function shows the relationship between consumption and:
a. interest rates. b. saving. c. price level changes. d. disposable income.
Frictional unemployment is the result of
a. not enough jobs for everyone to be employed. b. unemployed workers' skills not matching those needed for the available jobs. c. a decline in the demand for labor, such as during a recession. d. imperfect information and temporary periods of unemployment while workers are changing jobs.