The steeper the Security Market Line:
A. the lower the risk premium.
B. the more investors dislike risk.
C. the less investors are concerned about risk.
D. the greater the risk-free interest rate.
B. the more investors dislike risk.
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What does it mean that the Fed is the lender of last resort?
a. The Fed is the only institution that lends to banks. b. The Fed lends to banks before other institutions will loan money to them. c. The Fed lends to banks when no one else will loan money to them. d. The Fed ensures that other institutions will lend money to banks.
A. there are always trade-offs between economic goals. B. all production involves the use of scarce resources and thus the sacrifice of alternative goods. C. marginal analysis is used in economic reasoning. D. choices need not be made if behavior
is rational. A. there are always trade-offs between economic goals. B. all production involves the use of scarce resources and thus the sacrifice of alternative goods. C. marginal analysis is used in economic reasoning. D. choices need not be made if behavior is rational.
Refer to the above figure. The points between A and B are known as
A. a peak. B. a trough. C. an expansion. D. a contraction.
Often single-owner proprietorships seem more profitable than they really are. The reason for this is that
A. they are not allowed to deduct depreciation expense. B. they often fail to consider the opportunity cost of the labor provided by the owner. C. they receive special tax benefits compared to corporations. D. they use different accounting procedures.