For Breakdowns in Lending by Financial Institutions to Affect the Volume

question 42

Multiple Choice

For breakdowns in lending by financial institutions to affect the volume of funds flowing from savers to borrowers,

• A)financial institutions must charge lower interest rates than other lenders.
• B)financial institutions must charge higher interest rates than other lenders.
• C)alternative sources of funds to borrowers must be imperfect substitutes for loans from financial institutions.
• D)financial institutions must be subject to less regulation than other lenders.

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Definitions:

Dermatitis

An inflammation of the skin that leads to itchiness, redness, and sometimes swelling, which can be caused by allergies, irritants, or genetic factors.

Inflammatory Condition

A response of body tissues to injury or irritation characterized by pain, swelling, redness, and heat.

Reticular Layer

The deeper layer of the dermis in the skin, characterized by its dense network of collagen and elastin fibers.

Dermis

The thick layer of living tissue below the epidermis, containing nerve endings, sweat glands, and hair follicles, contributing to skin's flexibility and strength.