In a World Without FIs, Households Will Be Less Willing

question 14

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 above.

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Definitions:

Validity

The degree to which a test actually measures what it’s supposed to measure.

Unconscious

Refers to the part of the mind that influences thoughts, feelings, and behaviors without one's awareness.

Freud

Sigmund Freud was an Austrian neurologist and the founder of psychoanalysis, a clinical method for treating psychopathology through dialogue between a patient and a psychoanalyst.

Personality Inventories

Psychological assessment tools designed to evaluate a wide range of personality traits.