Which of the following statements is true?
a. Interest rates charged to well-known corporations are higher than rates charged to individuals because corporations can afford it.
b. If people expect higher rates of inflation, the market interest rate will decrease because fewer people will borrow.
c. Interest rates in unstable countries are lower than rates in stable countries.
d. The risk cost of doing business in a high-crime area is greater and the cost of borrowing is, therefore, greater there.
e. The lower the tax rate, the greater the cost of borrowing.
D
You might also like to view...
With illegal immigration the unskilled labor supply curve:
a. shifts to the left. b. becomes perfectly inelastic. c. becomes perfectly elastic. d. shifts to the right. e. becomes non-existent.
Under Alan Greenspan, the Fed:
A. Targeted interest rates only. B. Targeted the money supply only. C. Targeted the unemployment level. D. Used a mix of money-supply and interest-rate adjustments.
Other things equal, which of the following would shift an economy's production possibilities curve to the left?
A. The discovery of a low-cost means of generating and storing solar energy. B. The entrance of more women into the labor force. C. A law requiring mandatory retirement from the labor force at age 55. D. An increase in the proportion of total output that consists of capital or investment goods.
An increase in a country's saving rate will tend to cause which of the following in the long run?
A. an increase in the unemployment rate B. an increase in the rate of inflation C. an increase in economic growth D. a reduction in per capita real GDP