Which of the following is a debt instrument that specifies the timing of principal and interest payments?
A. stock
B. bond
C. share
D. equity
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________ refers to shares of ownership in a company's assets that give shareholders a claim on the company's future cash flows.
A. Stock
B. A bond
C. Debt
D. A draft
The ease with which bondholders and shareholders may convert their investments into cash is called ________.
A. barter
B. clearing
C. countertrade
D. liquidity
An expanded money supply ________.
A. reduces the cost of borrowing
B. increases interest rates
C. makes it difficult for financial institutions to lend money
D. diminishes entrepreneurial initiatives in a country
Which of the following is a major purpose of the international capital market?
A. to reduce entrepreneurial initiatives
B. to increase the cost of borrowing
C. to reduce risk for lenders
D. to reduce the money supply for borrowers