Investment Strategies — Cumulative exam Answers

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Equilibrium occurs when supply and demand coordinate to

set excess demand.

set prices and production.

maintain excess supply.

raise prices and production.

Why were savings and loans (S&Ls) originally established?

to help people invest in small businesses

to help people save money

to help people buy homes

to help people invest in the stock market

A possible result of disequilibrium is

excess demand.

lower demand.

fixed prices.

stable availability.

What part does interest play in deficit spending?

Governments must pay interest on money they borrow when they take on debt.

Citizens must pay interest when their governments borrow money.

Governments may charge foreign countries interest when they borrow money.

Interest is not a factor when a government’s budget is in deficit.

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