The three broad types of resources used to produce goods and services are also known as:
A) economic systems.
B) factors of production.
C) production possibilities.
D) financial capital.
Ans: B) factors of production.
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When a depository institution pools risk, it
A) buys short and lends long. B) borrows reserves from the Federal Reserve. C) spreads loan losses across many depositors so that no one depositor faces a high degree of risk. D) makes loans to just one firm.
The government can help solve the information asymmetry problem by:
A. making it illegal to complete a transaction without complete information. B. providing the missing information to the less-informed party. C. requiring the more informed party to not use the imbalance to their advantage. D. All of these statements are true.
Which of the following most completely describes the concept of price elasticity of demand?
a. A measure of the responsiveness of quantity demanded to a change in consumer income b. A measure of the responsiveness of quantity demanded to a change in the price of a substitute c. The percentage change in quantity demanded divided by the percentage change in price d. The percentage change in quantity demanded divided by the percentage change in the price of a substitute
Suppose you come up with a wonderful new invention, and after borrowing as much as you can from a bank, you believe that additional capital is needed to make the invention marketable. Your small new company would be most likely to find additional capital from
A. a venture capital firm. B. an initial public offering. C. issuing bonds. D. borrowing from a different bank.