Question

Which form of financial capital involves giving up ownership in a company?

Question 1 options:

a)	shares of stock

b)	a corporate bond

c)	a perpetuity bond

d)	a bank loan

Which of these would NOT be an investment in human capital?

Question 2 options:

a)	on-the-job training

b)	accepting lower wages during an apprenticeship

c)	college tuition

d)	operating a day-care center

Wage differentials are attributed to:

Question 3 options:

a)	luck only.

b)	high educational attainment only.

c)	economic discrimination only.

d)	investment in human capital and economic discrimination.

A bond's yield is:

Question 4 options:

a)	a periodic fixed payment made to a bondholder expressed as a percent of its face value.

b)	the current annual return to a bond.

c)	the date when the face value must be paid to the bondholder.

d)	the amount that must be repaid to the bondholder upon its maturity.

Answer 1

1) a share of stock

A share of stock is the share of ownership of firms assests and liabilities. It is a sale of ownership.

2) operating a day care center.

Investment in human capital can be the one labour productivity increases. Operating a day care center does not enhance productivity.

3) d is correct

People with higher education are likely to get higher wage and also discrimination is also practiced sometimes by employers in offering wage.

4) d is correct

A bond yield is the amount earned by bondholder at the time of maturity.