The phenomenon that some consumers pay a higher interest rate when they borrow than the interest rate they receive when they lend is best described as an example of
A) irrational behaviour.
B) a credit market imperfection.
C) a vast banking conspiracy.
D) the burden of public debt.
E) predatory lending practices.
Correct Answer:
Verified
Q2: An interest rate spread is
A) the difference
Q3: A collateral constraint captures the idea that
A)
Q4: In a simple model of credit imperfections,
Q5: If the proportion of bad borrowers increases,
A)
Q6: Collateralizable wealth is
A) wealth in non-tangible assets.
B)
Q7: When there are credit-market imperfections, an increase
Q8: If consumers face higher interest rates when
Q9: If there are fewer bad borrowers in
Q10: The 1990-1992 recession was unlikely to be
Q11: Limited commitment means
A) one cannot credibly promise
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