amount of risk have a rate of return In general, financial assets that have a a.
ID: 1161253 • Letter: A
Question
amount of risk have a rate of return In general, financial assets that have a a. higher; higher b. higher; lower c. lower; higher d. None of these is true, 26. In an economy without government or trade, it must be true that: a. savings equals investment b. consumption equals savings plus investment c. consumption plus savings equal investment. d. consumption plus investment equal national savings 27. 28. Bartering is: a. very efficient compared to using money. b. slightly inefficient compared to using money. C. just as efficient as using money. d. extremely inefficient compared to using money. 29. Fiat money is: a. any form of money that can be legall hanged into a fixed amount of an b. c. d. underlying commodity money created by rule. money used for the exchange of large commodities None of these is true. 30. Banks create money in the economy by: a. loaning out part of each deposit, which will be redeposited by someone else b. charging higher interest on loans than savings c. charging higher interest on savings than loans d. Only the government can create money.Explanation / Answer
26. A
Explanation:Financial assets that have higher amount of risk, they tend to offer higher rate of return to attract investors, otherewise no body would buy the financial asset. Therefore in financial assets that have a higher amount of risk have a higher rate of return.
27. A
Explanation: Whenever there is no govt interventions or foreign trade,
Saving = investment, because whatever that is left after consumption is saving because there is no tax paymnet. And since there is no foreign trade therefore there is no inflow of investment from outside. Therefore whatever is the savings of the nation that is put into investment.
28. D
Batering system is referred to exchange of goods and services in exchange of goods and services only, there is no use of money as a medium of exchange. It is highly ineffecient way of exchange, since it is extremely difficult to value goods and services in this manner. Suppose there is a person who can owns cows and the other person owns a land which reaps pulses. There is difficulty on how they both are going to exchange how much litres of milk with how much grams of pulses. This type of difficulty is faced by each and every memeber of the society.
29. A
Fiat money is any money which is declared by government to be used as a medium of exchange for fixed amount of an underlying commodity.
30. A.
Bank creates money by loaning out deposits which then are redeposited by someone else.
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