P89 - Econ 520 (Spring 2007) Problems for Chapters 8-9...

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Problems for Chapters 8-9 Masao Ogaki CHAPTER 8 Mishkin, P.215, Questions and Problems, 2, 4, 6 2. Multiple-Choice Problems Choose the one alternative that best completes the statement or answers the question. 1. If bad credit risks are the ones who most actively seek loans and, therefore, the problem of A) adverse selection. B) moral hazard. C) free-riding. D) regulartory forbearance. 2. That only large, well-established corporations have access to securities markets funds for businesses. B) can be explained by the problem of adverse selection. from acquiring funds in securities markets. D) can be explained by all of the above. 3. Solutions to the moral hazard problem include A) monitoring and enforcement of restrictive covenants. B) high net worth. C) greater reliance on equity contracts and less on debt contracts. D) all of the above.
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P89 - Econ 520 (Spring 2007) Problems for Chapters 8-9...

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