Stocks MCQs

Option A: Shifts the supply of loanable funds to the left and increase the real interest rate

Option B: Shift the supply of loanable funds to the right and reduces the real interest rate.

Option C: Shifts the demand for loanable funds to the right and increases the real interest rate.

Option D: Shifts the demand for loanable funds to the left and reduces the real interest rate

Correct Answer: Shift the supply of loanable funds to the right and reduces the real interest rate. ✔

Option A: Real interest rates rise and investment falls

Option B: Real interest rates rise and investment rises

Option C: Real interest rates fall and investment rises

Option D: Real interest rates fall and investment falls

Correct Answer: Real interest rates rise and investment falls ✔

Option A: an increase in public saving

Option B: a decrease in private saving

Option C: None of these answers

Option D: a decrease in public savings

Correct Answer: a decrease in public savings ✔

Option A: raise the real interest rate and decrease the quantity of loanable funds demanded for investment

Option B: lower the real interest rate and increase the quantity of loaable funds demanded for investment

Option C: raise the real interest rate and increase the quantity of loandable funds demanded for investment

Option D: lower the real interest rate and decrease the quantity of loanable funds demanded for investment

Correct Answer: raise the real interest rate and decrease the quantity of loanable funds demanded for investment ✔

Option A: Lower taxes on the returns to saving, provide investment tax credits and lower the deficit

Option B: Increase tax on the returns to saving Provide investment tax credits and increase the deficit

Option C: Increase tax on the returns to saving Provide investment tax credits and lower the deficit

Option D: Lower taxes on the returns to saving Provide investment tax credits and increase the deficit

Correct Answer: Lower taxes on the returns to saving, provide investment tax credits and lower the deficit ✔

Option A: The purchase of goods and services

Option B: The purchase of capital equipment and structures

Option C: When we place our saving in the bank

Option D: The purchase of stocks and bonds

Correct Answer: The purchase of capital equipment and structures ✔

Option A: Saving is unchanged

Option B: There is an increased in saving and the economy should grow more quickly

Option C: There is a decrease in saving and the economy should grow more slowly

Option D: There is not enough information to determine what will happen to saving

Correct Answer: Saving is unchanged ✔

Option A: there is a budget deficit

Option B: None of these answers

Option C: There is a budget surplus

Option D: private saving is positive

Correct Answer: there is a budget deficit ✔

Option A: none of these answers

Option B: investment + consumption expenditures

Option C: private saving + public saving

Option D: GDP government purchases

Correct Answer: private saving + public saving ✔

Option A: Probability of default

Option B: Price-earnings ratio

Option C: dividend

Option D: tax treatment

Correct Answer: Probability of default ✔

Option A: the real interest rate should fall

Option B: the real interest rate should rise

Option C: the impact on the real interest rate is indeterminate

Option D: the real interest rate should not change

Correct Answer: the impact on the real interest rate is indeterminate ✔

Option A: intermediation

Option B: equity finance

Option C: crowding out

Option D: the investment fund effect

Correct Answer: crowding out ✔

Option A: a reduction in the budget deficit

Option B: an increase in the budget deficit

Option C: an investment tax credit

Option D: None of the above

Correct Answer: a reduction in the budget deficit ✔

Option A: Shifts the supply of loanable funds to the right

Option B: Shift the demand for loandbale funds to the left

Option C: Shift the demand for loanable funds to the right

Option D: Shift the supply of loanable funds to the left

Correct Answer: Shift the supply of loanable funds to the left ✔

Option A: The supply of loanable funds in the Pakistan loanable funds market to shift to the right and the real interest rate to fall.

Option B: The demand for loanable funds in the Pakistan loanable funds market to shift to the right and the real interest rate to rise

Option C: The demand for loandable funds in the Pakistan loanable funds market to shift to the right and the real interest rate to fall

Option D: The supply of loandable funds in the Pakistan loanable funds market to shift to the right and the real interest rate to rise

Correct Answer: The supply of loanable funds in the Pakistan loanable funds market to shift to the right and the real interest rate to fall. ✔

Option A: A bond issued by a startup company

Option B: A government bond issued by the government of France.

Option C: A bond issued by a blue-chip company

Option D: An investment funds with portfolio of corporate bonds issued by blue chip companies

Correct Answer: A bond issued by a startup company ✔

Option A: Saving = Rs 300 investment = Rs 300

Option B: Saving = Rs 200 investment = Rs 100

Option C: Saving = Rs 100 investment = Rs 200

Option D: Saving = Rs 0 investment = Rs 0

Correct Answer: Saving = Rs 0 investment = Rs 0 ✔

Option A: Long-term bonds tend to pay less interest than short-term bonds

Option B: Government bonds pay less interest than comparable corporate bounds

Option C: Investment funds are riskier than single stock purchases because the performances of so many different firms can affect the return of a mutual fund

Option D: A stock index is a directory used to locate information about selected stocks.

Correct Answer: Government bonds pay less interest than comparable corporate bounds ✔

Option A: buyers and sellers

Option B: husbands and wives.

Option C: borrowers and lenders.

Option D: labor unions and firms

Correct Answer: borrowers and lenders. ✔

Option A: Corporate bonds

Option B: Company shares

Option C: All of these answers are equity finance

Option D: Government bonds

Correct Answer: Company shares ✔