When the financial system lacks the capability of making judgement about investment opportunities due to asymmetric information leading to potentially bad credit risks lending is subject to ?

When the financial system lacks the capability of making judgement ab

1.	When the financial system lacks the capability of making judgement about investment opportunities due to asymmetric information leading to potentially bad credit risks lending is subject to ?
A.	adverse selection
B.	moral hazard
C.	social goods
D.	hyperinflation
Answer» B. moral hazard

Discussion

No Comment Found

Related MCQs

Inflation is measured by the ? I- consumer price index (CPI) II- GDP deflator III- current account IV- depreciation
Which of the following are costs of inflation ? I- inflation weakens the creation of credit and capital markets II- inflation distorts business behavior especially investment behavior III- inflation increase the price of foreign goods relative to domestic goods IV- Inflation imposes a tax on the holders of money
Under financial repression ? I- banks engage in non-price rationing of loans II- banks face pressure for loans to those with political connections III- banks charge a high premium on foreign investments IV- banks depend on foreign banks to set interest rates
When the financial system lacks the capability of making judgement about investment opportunities due to asymmetric information leading to potentially bad credit risks lending is subject to ?
Which of the following is NOT true ?
Central banks in LDCs generally have less effect on expenditure and output than in LDCs because of ? I- an externally dependent banking system II- a poorly developed securities market III- a low percentage of demand deposits divided by the total money supply IV- the relative insensitivity of investment and employment to monetary policies
With _______ prices rise in the first sector, remain the same in the second and increase overall?
fiscal incentives to attract businesses from abroad include ? I- tax holidays II- accelerated depreciation III- import duty relief IV- lower tax rates for reinvested business profits
By using fiscal policy, i (e) varying ______ and/or _____ governments achieve goals for output and employment growth as well as price stability?
If people with higher incomes pay a higher percentage of income in taxes, the income tax structure is ?

When the financial system lacks the capability of making judgement about investment opportunities due to asymmetric information leading to potentially bad credit risks lending is subject to ?

Discussion

No Comment Found

Related MCQs

Reply to Comment