Describe how the use of leverage affects the impact of bank investments
Leverage amplifies the impact from changes in the value of assets on bank capital. Most banks operate such that the ratio of bank assets to capital is large. When bank assets change in market value, bank capital must adjust so that the balance sheet will balance. With a large leverage ratio, a small change in asset value must be offset by a relatively large percent change in capital.
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What is the journal entry to record the direct labor summarized on the labor distribution report?
a. debit to Finished Goods and credit to Payroll b. debit to Work-in-Process and credit to Payroll c. debit to Payroll and credit to Direct Labor d. debit to Payroll and credit to Cash
The table above gives the demand schedule for a good. Using the midpoint method, find the price elasticity of demand between points A and B, between B and C, between C and D, and between D and E
What will be an ideal response?
In a mixed-strategy Nash equilibrium, a player is willing to randomize because:
a. this confuses opponents. b. he or she is indifferent between the actions in equilibrium. c. the actions provide the same payoffs regardless of what the other player does. d. he or she does not know what the other player is doing.
Under the Bretton Woods agreement,
a. nations could not adjust their exchange rates relative to the dollar for any reason b. currency values were based on a market basket of European currencies plus the dollar c. the world monetary system operated exactly like the gold standard of pre-World War II years d. the dollar was selected as the key reserve currency e. gold played no role