A bank can usually offer a saver a higher return for the same risk for all of the following reasons except:
A. the bank can pool the resources of small savers and purchase higher valued assets.
B. economies of scale can also be applied by the bank in its purchase of assets.
C. savers do not have good enough information to know if the return is sufficient.
D. the bank can usually purchase assets at a lower cost than any one saver.
Answer: C
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The above figure shows Bobby's indifference map for juice and snacks. Also shown are three budget lines resulting from different prices for snacks. As the price of snacks rises, Bobby's utility
A) stays the same. B) increases. C) decreases. D) might change, but there is not enough information to determine.
The period of growth in real GDP between the trough of the business cycle and the next peak is called the
a. recessionary phase. b. expansionary phase. c. contractionary phase. d. cyclical phase.