the economics of money, banking, and financial markets

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13. 
    

    A sharp decline in the stock market means that the ____ of corporations has fallen.
    A) net worth
    B) interest rates
    C) liabilities
    D) payrolls
    Answer: A
    Diff: 1 Type: MC Page Ref: 184
    Skill: Recall
    Objective List: 9.1 Discuss the factors that lead to financial crises

    
    


14. 
    

    In a bank panic ____.
    A) free-rider increase
    B) bond prices increase
    C) transactions costs increase
    D) multiple banks fail
    Answer: D
    Diff: 1 Type: MC Page Ref: 184
    Skill: Recall
    Objective List: 9.1 Discuss the factors that lead to financial crises

    
    


15. 
    

    In a bank panic, the source of contagion is the ____.
    A) free-rider problem
    B) too-big-to-fail problem
    C) transactions cost problem
    D) asymmetric information problem
    Answer: D
    Diff: 1 Type: MC Page Ref: 184
    Skill: Recall
    Objective List: 9.1 Discuss the factors that lead to financial crises

    
    


16. 
    

    Factors that lead to worsening conditions in financial system include ____.
    A) increases in net worth
    B) stock market increases
    C) decreases in interest rates
    D) stock market declines
    Answer: D
    Diff: 1 Type: MC Page Ref: 184
    Skill: Applied
    Objective List: 9.1 Discuss the factors that lead to financial crises