While the Goal of Almost All Microcredit Programs Is to Raise

question 11

Multiple Choice

While the goal of almost all microcredit programs is to raise well-being,which of the following could hurt a family as a result of taking a microloan?

• A) Having to work more hours to repay the loan
• B) A sound investment could not work out because of poor demand
• C) Illness may or poor investments may cause the family to reduce consumption further to repay the loan plus interest
• D) All of the above

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Definitions:

Demand Function

A mathematical expression showing the relationship between the quantity demanded of a good and various factors that affect this quantity, such as price, income, and prices of related goods.

Cross Price Elasticity

A gauge of the responsiveness in the demand for a specific product due to fluctuations in the pricing of another product.

Midpoint Method

A technique used in economics for calculating elasticity by averaging the starting and ending prices and quantities.

Cross-Price Elasticity

Measure of how the quantity demanded of one good responds to a change in the price of another good.