1. Which of the following statements about debt and equity characteristics are true?

A) Debt and Equity are the two primary sources of capital accumulation.

B) Equity capital is the Capital bought by business owners, and debt is the Capital lent by vendors.

C)Fund has been raised through debt and equity

D) All of the above.

2. The lower the demand to borrow federal funds relative to a higher supply of excess funds available at other banks, the _______ the federal funds rate.

1. Higher
2. Lower

3. An increase in ________ decreases the money supply since it causes the ________ to fall.

A) reserve requirements; money multiplier

B) reserve requirements; monetary base

C) margin requirements; monetary base

D) margin requirements; money multiplier

4. You will not lose money from the following position if the underlying asset falls in value:

1. sell a forward
2. write a call
3. buy a put
4. the buyer of a futures contract