macro sheflin hwk 10

macro sheflin hwk 10 - hw10 Multiple Choice Identify the...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
hw10 Multiple Choice Identify the choice that best completes the statement or answers the question. 1. When opening a restaurant you may need to buy ovens, freezers, tables, and cash registers. Economists call these expenditures a. capital investment. b. investment in human capital. c. business consumption expenditures. d. None of the above is correct. 2. When a country saves a larger portion of its GDP, it will have a. more capital and higher productivity. b. more capital and lower productivity. c. less capital and higher productivity. d. less capital and lower productivity. 3. Institutions in the economy that help to match one person's saving with another person's investment are collectively called the a. Federal Reserve system. b. banking system. c. monetary system. d. financial system. 4. Which of the following is not correct? a. When a country saves more, it has more capital. b. A supplier of loanable funds borrows money. c. The interest rate adjusts to balance the quantity supplied of and the quantity demanded of loanable funds. d. If Mary buys equipment for her factory, Mary is engaging in capital investment. 5. A bond is a a. financial intermediary. b. certificate of indebtedness. c. certificate of partial ownership in an enterprise. d. None of the above is correct. 6. Which of the following would be an example of direct finance? a. A saver buys shares in a mutual fund. b. A saver deposits money into a credit union. c. A saver buys a bond a corporation has just issued so it can purchase capital. d. None of the above is correct. 7. If the government's expenditures exceeded its receipts, it would likely a. lend money to a bank or other financial intermediary. b. borrow money from a bank or other financial intermediary. c. buy bonds directly from the public. d. sell bonds directly to the public. 8. If Proctor and Gamble sells a bond it is a. borrowing directly from the public. b. borrowing indirectly from the public. c. lending directly to the public. d. lending indirectly to the public. 9. Which of the following is correct? a. The maturity of a bond refers to the amount to be paid back. b. The principal of the bond refers to the person selling the bond. c. A bond buyer cannot sell a bond before it matures. d. None of the above is correct. 10. A perpetuity is distinguished from other bonds in that it a. pays continuously compounded interest. b. pays interest only when it matures. c. never matures. d. will be used to purchase another bond when it matures unless the owner specifies otherwise. 11. Which of the following is correct? a. Some bonds have terms as short as a few months. b. Because they are so risky, junk bonds pay a low rate of interest. c. Corporations buy bonds to raise funds. d. All of the above are correct. 12. Compared to long-term bonds, other things the same, short-term bonds generally have
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 09/26/2008 for the course ECONOMICS 103 taught by Professor Sheflin during the Spring '08 term at Rutgers.

Page1 / 7

macro sheflin hwk 10 - hw10 Multiple Choice Identify the...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online