The risk of financing a project by issuing common stock is borne by
A. the issuing firm only.
B. the stockholders only.
C. both the issuing firm and the stockholders.
D. the government.
Answer: B
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Including investment and production in the two-good, two-period model with trade
A) allows the country to equalize absorption and output demand. B) renders terms of trade endogenous. C) allows the country to react to changes in the interest rate. D) allows the government to run budget deficits.
The ability to quickly convert an asset into cash is
A) disintermediation. B) the standard of deferred payment. C) financial intermediation. D) liquidity.
According to the law of comparative advantage, a doctor who is also a talented auto mechanic should
a. get a part-time job at a gas station. b. do her own auto repairs and those of her neighbors. c. hire a professional mechanic to repair her car. d. only repair the cars of other doctors.
The Dow Jones Industrial Average is a:
A. value-weighted index. B. simple average. C. price-weighted index. D. total-value index.