Less Developed Countries Are Often Characterized by Imperfect Capital Markets

question 48

Multiple Choice

Less developed countries are often characterized by imperfect capital markets.Assuming that the LCH applies to these countries and that a large proportion of the population is below fifty the

• A)MPC should be relatively high.
• B)MPC should be relatively low.
• C)frequency of liquidity constraints is low.
• D)sensitivity of consumption to loans is low.

---

Definitions:

Health Insurance

A type of insurance that covers whole or part of the risk of a person incurring medical expenses.