Describe the significance of IMF quotas
What will be an ideal response?
To become a member of the IMF, a state must contribute a certain sum of money (expressed in SDRs) called a quota subscription. The quota is based on the relative size of a member state's economy, and it serves various purposes. First, members' quotas make up a pool of funds on which the IMF can draw to lend to a particular member having financial difficulties. Second, quotas determine how much a contributing member can borrow from the IMF and how much it will receive in periodic allocations of SDRs. Third, quotas determine the members' voting power in the IMF. Those who contribute the most to the IMF are given the greatest say in setting its policies.
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Businesses can best meet their responsibility to society by:
A. creating markets for domestic products. B. shifting the blame for product liability cases onto the legal system. C. supporting their preferred government officials. D. creating wealth for their stockholders.
Nominal rate of interest is equal to ________
A) the real rate plus an inflationary expectation B) the real rate plus a risk premium C) the risk-free rate plus an inflationary expectation D) the risk-free rate plus a risk premium