Evaluate the following statements

Subject:EconomicsPrice: Bought3

Share With

Evaluate the following statements.True/False/It Depends? Explain your answers briefly

A]Real-world financial markets are not perfect: Interest rates on loans tend to be greater than those on deposits. Why? Briefly present two real world reasons.

B]

Imagine person X whose income stream is entirely front-loaded (say, in a twoperiod world, all income comes in first period and none of it in second). Statement to evaluate: "Person X does not care whether financial markets are perfect or imperfect".