Increases in Interest Rates

question 85

Multiple Choice

Increases in interest rates

• A)reduce borrowers' net worth.
• B)reduce lenders' net worth.
• C)increase the present value of borrowers' assets.
• D)raise the cost to businesses of internal funding.

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Definitions:

Cash Receipts

The collection of money, including coins, notes, and electronic transactions, received by a business.

Equity Method

An accounting technique used by a company to record its investment in another company when it has significant influence over that company but not full control or ownership.

Dividends

Payments made by a corporation to its shareholder members, distributing a portion of the company's earnings.