Because borrowers, once they have a loan, are more likely to invest in high-risk investment projects, banks face the
A) adverse selection problem.
B) lemon problem.
C) adverse credit risk problem.
D) moral hazard problem.
D
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Commodity money has intrinsic value
Indicate whether the statement is true or false
Which one of the following is a leakage from the circular flow of income?
(a) Exports. (b) Taxation. (c) Investment. (d) Externalities.
Which of the following events at an automobile manufacturing plant would most likely cause the movement from S 1 to S 2 ?
a. Hundreds of additional workers were hired to staff a new shift.
b. Millions of dollars were invested to expand and outfit the new facility.
c. Amenities in the plant included onsite child care, a gym, and a health clinic.
d. Many workers were laid off when some plant operations were automated.
One consequence of unemployment is that:
A. the time and skills of the unemployed are not being put to use. B. it can create uncertainty about the future. C. some productive potential of the economy is being wasted. D. All of these are consequences of unemployment.