Correct Answer:
Making new additions to a firm’s stock of capital.
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Money market securities are sometimes referred to as cash equivalents because _____.
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They are safe and marketable.
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One of the main reasons that Lehman Brothers failed is that it ______.
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Underestimated the risk of mortgage-backed securities
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Quickly buying and selling houses is known as ______.
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Flipping
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In 2005–2006, the Fed ______.
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Raised interest rates
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Many of the people who took out subprime loans early in the 21st century ______.
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Were ineligible for traditional loans
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Fed policy after the 2001 recession ______.
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Created low interest rates
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The theory that government borrowing drives up the interest rate, lowering consumption by households and investment spending by firms is known as ______.
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The crowding-out effect
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The supply of loanable funds curve is ______.
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Positively sloped
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Vera is studying the national budget of her country. She has found that, for her nation, T > G + TR. Vera’s country has ______.
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A budget surplus
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The sum of private saving and public saving in an economy is known as its ______ saving.
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National
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The relationship between saving and investment for an entire economy is represented by the equation ______.
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S = I
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If Company Q were to go bankrupt, the owners of Company Q’s ______ would be most exposed to risk.
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Common stock
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Financial institutions that accept funds from households and make them available to firms are known as ______.
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Financial intermediaries
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Stocks and bonds are often referred to as ______.
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Securities
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A stock that pays fixed, regular dividend payments that do not vary with the profits of the corporation is known as ______.
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Preferred stock
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Entities that hold shares of stock in a corporation are called ______.
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Stockholders
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Entities that hold shares of stock in a corporation are called
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Stakeholders
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Stocks and bonds are securities
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True
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The practice of using corporate profits for capital investment rather than dividend payouts is called
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Retaining earnings
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A stock that pays fixed, regular dividend payments that do not vary with the profits of the corporation is called
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Preferred stock
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The theory that government borrowing drives up the interest rate, lowering consumption by households and investment spending by firms is called
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Crowding out effect
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Residual claimants of corporate resources who receive a proportion of profits based upon the ratio of shares held is called
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Common stock
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Bonds are obligations issued by the corporation that promise the holder to receive fixed annual interest payments and payment of the principal upon maturity
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Correct Answer:
True
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