Economics: The Basics 1st Edition by Mike Mandel

Exercise 1

Say whether each of the following statements is true or false.
a) If the interest rate rises, borrowers will demand more loans, all other things being equal.
b) A Hollywood movie studio might borrow to finance the production of a new film.
c) The supply curve for loans is downward-sloping.
d) A stronger economy tends to lower interest rates, all other things being equal.
e) A bank makes profits by charging higher interest rates on their loans than they pay on their deposits.
f) Venture capital firms take big risks in exchange for the possibility of big returns.
g) All stocks pay dividends.
h) Diversification means buying a lot of stock from one company only.
i) If a company sells bonds, that means it is borrowing money.