Since the future holds more uncertainty over longer periods of time, lenders generally want a:
A. constant interest rate for loans over the period of the loan.
B. higher interest rate for loans over a longer period.
C. lower interest rate for loans over a longer period.
D. higher interest rate for loans over a shorter period.
Answer: B
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The federal funds market is the market for
a. loans from the federal government. b. loans from the Federal Reserve. c. government borrowing and lending. d. interbank lending. e. all of the above.
If a bank receives a deposit of $3,000 and loans out $2,000 . what changes will occur on the bank's balance sheet (after all checks involved with the loan are cleared)?
a. Reserves decrease by $3,000 . total assets decrease by $1,000 . and total liabilities increase by $3,000. b. Reserves increase by $1,000 . total assets increase by $2,000 . and total liabilities increase by $3,000. c. Reserves increase by $3,000 . total assets by increase $3,000 . and total liabilities increase by $3,000. d. Reserves increase by $3,000 . total assets by increase $2,000 . and total liabilities decrease by $3,000. e. Reserves increase by $1,000 . total assets increase by $3,000 . and total liabilities increase by $3,000.