Which of the following is NOT a reason that credit ratings agencies became more relevant beginning in the late 1970s?
A) the number of bond defaults rose due to periods of recession and inflation
B) rating agencies began to charge investors for their services
C) governments began to include bond ratings in their regulation of banks, mutual funds, and other financial firms
D) rating agencies began to rate bonds issued by foreign governments and firms
B
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Fill in the blank: Middlemen tend to have ________ in information production
A) no interest B) a comparative advantage C) a monopoly D) little time to engage E) a wasteful way of engaging
Which of the following will result as part of the interest rate effect when the price level rises? a. Households and firms increase their holdings of money
b. Interest rates will increase. c. A lower quantity of real GDP will be demanded. d. All of the above will result as part of the interest rate effect when the price level rises.
Suppose a factory that produces toasters experiences a decline in its average total cost with no change in its output level. This decline might be explained by:
A. economies of scale. B. technological change. C. decreasing marginal utility. D. increasing marginal productivity.
If the market price of coffee is $3.00 per pound but the government will not allow coffee growers to charge more than $2.00 per pound of coffee, which of the following will happen?
A. Demand must eventually decrease so that the market will come into equilibrium at a price of $2.50. B. The market will be in equilibrium at a price of $2.00. C. There will be a shortage of coffee. D. Supply must eventually increase so that the market will come into equilibrium at a price of $2.50.