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Chapter 1: Why Study Money, Banking, and Financial Markets?

Q.6

Page 66

Can you think of a reason why people in general do not lend money to one another to buy a house or a car? How would your answer explain the existence of banks?

Q 7.

Page 66

Name two institutions that are not important financial intermediaries in an economy

Q. 8

Page 66

Can you date the latest financial crisis in the United States or in Europe? Are there reasons to think that these crises might have been related? Why?

Q.9

Page 66

What is one of the reasons for inflation in your country? Provide empirical evidence to support your answer.

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