Pooling of risk occurs when depository institutions
A) make assets more liquid.
B) specialize in loaning only to good borrowers.
C) bring lenders together.
D) lend to a variety of different borrowers.
D
You might also like to view...
The rate of return on bonds is lower than on stocks over time because
A) bond holders cannot diversify. B) bonds have a lower standard deviation in returns. C) stocks have less non-diversifiable risks than bonds. D) bonds are subject to more random risks than stocks.
Other things remaining constant, higher trade deficits in the U.S. will lead to: a. U.S citizens buying greater foreign securities
b. an increase in domestic savings in the U.S. c. a decrease in the demand for U.S. dollars. d. an increase in funds from abroad. e. an increase in the standard of living of the U.S residents.
Increasing prices tend to decrease interest rates and increase investment spending
a. True b. False Indicate whether the statement is true or false
Suppose a certain country imposes a tariff on a good. Which of the following results of the tariff is possible?
a. Consumer surplus decreases by $100; producer surplus increases by $100; and government revenue from the tariff amounts to $50. b. Consumer surplus decreases by $200; producer surplus increases by $100; and government revenue from the tariff amounts to $50. c. Consumer surplus increases by $100; producer surplus decreases by $200; and government revenue from the tariff amounts to $50. d. Consumer surplus decreases by $50; producer surplus increases by $200; and government revenue from the tariff amounts to $150.