A rational individual would make charitable contributions only if such contributions receive favorable tax treatment

Funds flow from lenders to borrowers

A) indirectly through financial markets. B) directly through financial intermediaries. C) indirectly through financial intermediaries. D) primarily through government agencies.

Refer to Figure 10.7. A movement from point A to point B could be caused by

A) a negative demand shock. B) a decrease in the term premium investors expect in the future. C) an increase in the default-risk premium. D) an increase in the expected rate of inflation.