Leverage is best defined as:
A. low interest rates at the beginning of the term of a loan that later rise.
B. using friends inside the banking industry to secure loans.
C. the ability of people without income to secure mortgages.
D. the practice of buying an asset with borrowed money.
Answer: D
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In the above figure, if the price is P1 and the firm produced Q1, the firm's economic profit is ________ than if it produced Q2 and ________ than if it produced Q3
A) less; less B) less; more C) more; less D) more; more
The fact that interest groups exist on both sides of an issue mean that _____
a. no special interest group gets everything it wants b. rational ignorance is nonexistent c. a prisoner's dilemma exists d. politicians are exposed to all viewpoints on an issue
Neo-Keynesians believe that the inverse relationship between rates of unemployment and rates of inflation is causal
Indicate whether the statement is true or false
A firm is producing 100 units of output at a total cost of $400. The firm's average variable cost is $3 per unit. What is the firm's total fixed cost?
A. $100 B. $50 C. $300 D. $1