Economic Policy and Market Entry Quiz
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Questions and Answers

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?

  • 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?

  • 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?

    <p>Benefit corporation</p> Signup and view all the answers

    Which action by the central bank does not aim to reduce the money supply in markets?

    <p>The central bank buys treasury bills from the market</p> Signup and view all the answers

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