Why does the free-rider problem occur in the debtmarket?

Q: Suppose that, prior to the passage of the Truth in Lending Simplification Act and Regulation Z, the…

A: Given that before the passage of truth in Lending Simplification Act and Regulation Z, the demand…

Q: Why did President Obama signed Dodd-Frank Wall Street Reform and Consumer Protection Act into law?

A: The Dodd Frank Wall Street Reform and Consumer Protection Act could be a law that regulates money…

Q: What happens when the "Tax Ratio" of the commercial banks in the positive figure?

A: The Tax Ratio is the most strong indicator of a person's tax efficiency. The tax ratio is the…

Q: DIFFERENCE BETWEEN Debt and equity markets

A: Debt and equity markets are markets where firms borrow capital and investors lend capital.

Q: Can a debtor be put in delay and consequently, incur liability even without demand from creditor?…

A: Debtor:- A debtor can be explained as a legal person that promises to repay any amount to another.…

Q: How can we determine the Cost of Debt?

A: The cost of debt calculation is useful in determining the average rate a business is paying for…

Q: Discuss the arguments for and against the acceptance of gratuities by law enforcement

A: There are certain arguments in favor of acceptance. In general cases gratuities are not always made…

Q: explain the dangers of high debt?

A: In financial economics, the term debt represents the amount of money borrowing or dues which are…

Q: What are the difference between public and private finance?

A: Public finance refers to the study regarding the income and expenditure of the government. It…

Q: Conduct an argument on why social Security should not be privatized. Describe the disadvantages on…

A:

Q: Why people buy public debt, even if it does not pay any interest?

A: Public debt is the debt that a nation owes to lenders outside the nation. These lenders can be…

Q: The receipts which either creates a liability or cause a reduction in the assets of the government…

A: While accounting the government budget, we come across the concept of revenue receipt which is a…

Q: Why do equity holders care more about ROE thanabout ROA?

A: The ROE i.e. Return on Equity and the ROA i.e. Return on assets measures the excess return or…

Q: explain the dangers of high debt, defualt risk, and vicious cycles

A: Dangers of high debt:   When nations face situation of high debt which lead to following main…

Q: Differentiate between federal fund and repurchase agreement.

A: A list of Bank Sources of Funds are given below: Transaction Deposits Time Deposits Repurchase…

Q: Describe Debt Management?

A: Debt Management refers to management of the debt with the help of financial budgeting and planning.

Q: in 50 words. what is meant by the ‘cap’ on Social Security?

A: Social security is defined as the protection that a society provides its citizens against certain…

Q: WHich are two main types of debt instruments issued by the Australian Government?

A: Debt is an obligation that legally binds the borrower to pay back the lender the principal amount…

Q: Identify and describe the 5 components of the revenue cycle.

A: Revenue cycle management means the process of identifying, collecting and managing the patients…

Q: Please help me find what are theories of Public Borrowing, starting from the Classical Theory of…

A: The following problem has been answered as follows:

Q: Why do most creditors prefer low debt ratios?

A: Debt to Equity(D/E) ratio is calculated  as: Total Liabilities/Shareholder’s Equity A low debt ratio…

Q: Explain the short term and long term debt instruments

A: The instruments used in the financial markets are the instruments that are used to transact or even…

Q: Which is a reason for why private banks tend not to use the discount window?

A: The federal rate is the rate at which commercial banks borrow from each other whereas a discount…

Q: Explain how the federal government finances and services its outstanding debt

A: Government debt, or national debt, is formed from all prior budget deficits of an economy accrued,…

Q: Explain how financial crisis can impact public sector delivery and performance?

A: The financial crisis is a situation in the economy in which the price of asset decline steeply,…

Q: Compare and contrast expert lending systems with statistical credit scoring models

A: Lending money by the banking sector is the core activity of Banking Financial Corporations. Most of…

Q: Distinguish between the general credit control and selective credit control and examine their…

A: The economies work with the motive to enhance their productivity levels because it helps in building…

Q: How is the Federal Reserve dealing with the economic crisis of the pandemic debt. Corporate bonds?

A: The Federal Reserve has proposed relief initiatives for MBS, vehicle loans, money markets, credit…

Q: True or False: Federal law governs how bankruptcy is managed. O True O False

A: Given the question is Federal law governs how bankruptcy is managed.  True  False.

Q: What is the fundamental difference in the way businesses approach debt andthe way consumers approach…

A: Debt is the amount of money extracted by individuals or firms from other individuals and firms,…

Q: Banking regulation suffers from the principal-agent problem. Describe how this problem relates to…

A: In economic science, the principal-agent issue has become a typical issue. Michael Johannes Vilhelm…

Q: should privatize Social Security in this country?  Why or why not?  Describe at least one advantage…

A: Advantage of privatizing Social Security : Singular speculation records would help the financial…

Q: Classify the factorsaffecting the FederalReserve’s assets andliabilities

A: The Federal Reserve has different activities that are needed to be done and looked at after the…

Q: An investor can create the effect of leverage on his/her account by: I) buying equity of a…

A: Financial leverage is understood as the ratio which shows the total borrowing of the company that…

Q: True or False: Negative debt always carries a high interest rate and high fees.

A: A negative debt for a company or organization means that the company is in a situation where its…

Q: Explain Debt Management?

A: Debt refers to the sum of money that is owed by an individual or corporation to the lending party.…

Q: Suppose you have data about two groups of countries,one with efficient legal systems and the other…

A: Adverse selection applies to a different knowledge issue that happens before the sale for all…

Q: What are the convergence of issues that led to and caused the subprime financial crisis of 2007-2008

A: Financial crisis of 2007-2008, particularly known as mortgage crisis was basically the result of…

Market Equilibrium and Failure

The economy of a country or any place depends on the market demand and market supply of goods and services.