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Econ 305 ch8 - ECON320 ProfessorC.JamesHueng 1 A B...

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ECON320 Chapter 8 Practice Test Professor C. James Hueng 1) Which of the following statements concerning external sources of financing for nonfinancial businesses in the United States are true? A) Stocks are a far more important source of finance than are bonds. B) Stocks and bonds, combined, supply less than one - half of the external funds. C) Financial intermediaries such as banks are the least important source of external funds for businesses. D) Since 1970, more than half of the new issues of stock have been sold to American households. 2) Which of the following statements concerning external sources of financing for nonfinancial businesses in the United States are true? 3) With regard to external sources of financing for nonfinancial businesses in the United States, which of the following are accurate statements? 4) Property that is pledged to the lender in the event that a borrower cannot make his or her debt payment is called 5) If you default on your auto loan, your car will be repossessed because it has been pledged as ________ for the loan. A) interest B) collateral C) dividend D) commodity 6) A ________ is a provision that restricts or specifies certain activities that a borrower can engage in. 7) A clause in a mortgage loan contract requiring the borrower to purchase homeowner ʹ s insurance is an example of a
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