In a World Without FIs, Households Will Be Less Willing

question 27

Multiple Choice

In a world without FIs, households will be less willing to invest in corporate securities because they

• A)are not able to monitor the activities of the corporation more closely than FIs.
• B)tend to prefer shorter, more liquid securities.
• C)are subject to price risk when corporate securities are sold.
• D)may not have enough funds to purchase corporate securities.
• E)All of the options.

---

Definitions:

Time Schedule

An organized plan specifying when tasks or events are expected to take place.

Hybrid Strategies

Business methods that combine elements of both cost leadership and differentiation strategies to achieve competitive advantage.

Differentiation

The process of distinguishing a product or brand from its competitors through unique characteristics, aiming to create a perceived value to encourage customer preference.

Cost Leadership

A business strategy focused on becoming the lowest cost producer in an industry to offer products or services at the most competitive price.