Often a bank will require a loan officer to make personal visits on customers with loans outstanding. This is encouraged because:
A. the bank wants to make sure the business is busy.
B. this is an effective monitoring technique and should reduce moral hazard.
C. the bank has excess funds available and hopes to make another loan to the business.
D. the bank worries about another bank trying to steal their customers.
Answer: B
You might also like to view...
The Ricardian model of international trade demonstrates that trade can be mutually beneficial. Why, then, do governments restrict imports of some goods?
A) Trade can have significant harmful effects on some segments of a country's economy. B) The Ricardian model is often incorrect in its prediction that trade can be mutually beneficial. C) Import restrictions are the result of trade wars between hostile countries. D) Imports are only restricted when foreign-made goods do not meet domestic standards of quality. E) Restrictions on imports can have significant beneficial effects on domestic consumers.
In real business cycle theory, the persistence of shocks to total factor productivity is justified by
A) the fact that some capital depreciates every period. B) the behavior of Solow residuals. C) the fact that Taylor rules have been used in post-war United States. D) the fact that capital takes some time to build.
Most entrepreneurs are self-employed
a. True b. False Indicate whether the statement is true or false
For what kinds of goods are buyers most likely to seek additional information about quality?
What will be an ideal response?