Which of the following is a source of market risk?
a. Holding stocks in many companies carries the risk of a reduced average return.
b. Real GDP varies over time and sales and profits move with real GDP.
c. When a paper producer has declining sales, it is likely that so will other paper producers.
d. If stockholders become aggravated with the way a CEO runs a company, the price of that company's stock might fall in the stock market.
b
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A monopoly firm expands its output and lowers its price. The firm finds that its total revenue falls. Hence, the firm is producing in the
A) elastic range of its demand curve. B) inelastic range of its demand curve. C) elastic range of its supply curve. D) inelastic range of its supply curve.
Local banks could pass the risk involved in holding mortgage debts on to an investor with a higher risk tolerance using:
A. mortgage-backed securities. B. leveraged securities. C. leveraged investments. D. government-backed securities.
A tax of a specific absolute sum levied on every person in the nation is called a(n)
a. income tax b. proportional tax c. progressive tax d. equitable tax e. poll tax
A foundation of planned socialism is:
a. the rule of law b. the median voter rule c. the primacy of horizontal transactions d. free pricing e. material balances