Borrowers can (and sometimes do) default on their loans when
a. the dividend yield on their shares of stock reaches zero.
b. they convert their bonds into perpetuities.
c. they declare bankruptcy.
d. they cannot find enough buyers of their bonds to sell all the bonds they wish to sell.
c
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Refer to Figure 2-8. Which country has a comparative advantage in the production of coconuts?
A) Guatemala B) Costa Rica C) They have equal productive abilities. D) neither country
The degree of a factor's specificity is directly related to
A) the amount of time required to redeploy the factor to a different industry. B) the cost of the factor as a proportion of the long-run total cost of production. C) the mobility of the factor, with more mobile factors having more specificity. D) technology differences between two countries, with a more advanced technology resulting in more factor specificity. E) factor quality, with higher quality factors having a higher level of specificity.
One common example of a price ceiling is rent control
a. True b. False Indicate whether the statement is true or false
The crowding-out effect is
A. only relevant when an inflationary gap is present. B. a situation in which expansionary fiscal policy leads to a decrease in planned spending in the private sector. C. due to the upward slope of the SRAS when the economy is operating to the right of the LRAS curve. D. due to the government being more powerful in the markets when there is an increase in government spending.