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Questions and Answers
Which of the following actions has the goal of reducing the money supply in markets?
Which of the following actions has the goal of reducing the money supply in markets?
- The central bank reduces the so-called reserve requirement
- The central bank raises the interest rate (correct)
- The central bank decreases property taxes
- The central bank buys treasury bills from the market
What is a major difference between debt financing and equity financing?
What is a major difference between debt financing and equity financing?
- Equity financing has a specific maturity period, whereas debt financing usually has no specific maturity period (correct)
- Equity holders have primary claims on assets unlike debt financiers
- Equity financing is based on issuing bonds, while debt financing is based on issuing stocks
- Debt financing is used to cover long-term expenses, whereas equity financing is used for current expenses
What refers to a resource or capability a company must have before it can start competing in a given market?
What refers to a resource or capability a company must have before it can start competing in a given market?
- A CS department
- A customer service department
- Free-market system
- A barrier to entry (correct)
What type of organization seeks to operate efficiently and effectively to achieve its goals without focusing on profit as a motive?
What type of organization seeks to operate efficiently and effectively to achieve its goals without focusing on profit as a motive?
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Which action by the central bank does not aim to reduce the money supply in markets?
Which action by the central bank does not aim to reduce the money supply in markets?
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