Answer:
The answer is: I) Banks have more diversified asset portfolios
Explanation:
Commercial banks receive deposits from clients and work with a variety of accounts; from personal or commercial loans, letters of credit, movement of funds, to a whole variety of different assets depending on what financial powers have been granted to them by the state or federal law by which they operate.
Instead Thrifts (saving and loans associations) usually specialize in real estate lending and Credit Unions offer their services only to their members.
Answer:
D.All of the above are correct.
Explanation:
Moral hazard is when people have an incentive to engage in risky behaviours when the person is protected against the consequences of such risky behaviour. Moral hazard can arise in health insurance because once insured, a person has less incentive to adopt a healthy lifestyle.
Adverse selection occurs due to asymmetry of information; when one party in a transaction has more information than the other party. An example of adverse selection In insurance - people who have dangerous jobs are more likely to purchase insurance when compared with people with relatively safer jobs. Adverse selection in health insurance is when healthiest people choose to be uninsured, at least during their younger years and become insured when they are getting older and more sickly.
I hope my answer helps you.
Answer:
1. Excluding and 4. Understate
Explanation:
We know,
Unemployment rate = Unemployed people ÷ Total labor force
Here, the total labor force includes total employed and unemployed people minus out of the labor force and discouraged workers. Discouraged workers are those who either do not want to do the job because of a lack of a suitable position or do not look for a job. However, the U-4 measure of labor under-utilization includes the discouraged worker in the labor force.
Therefore, excluding discouraged workers from the official unemployment rate would understate the true extent of the official rate of underemployment.
Which motivation theory might explain one’s need for financial security? I would say humanistic theory of motivation because I would consider it a basic human right to have financial security.
Answer:
D .the long-term spot rate is an average of the current and expected future short-term interest rates
Explanation:
Unbiased Expectations Theory -
According to this theory , it forecasts the short - term rate of interests of the future according to the current long - term rate of interests .
Which states that the investor gets the same interest amount during two consecutive one - year bond against investing in one two - year bond .
Hence , from the given statements , the correct statement regarding the unbiased expectations theory , is ( D. ) .