Glossary

Adverse Selection: occurs when a borrower who has no intention of paying back the loan would not divulge his intention.

Assets: are the collection of valuable goods and financial documents that can be exchanged for money.

Asymmetry of Information: exists when one party in a transaction has more information about the risk and other characteristics of the transaction than does the other party.

Auction Markets: are financial markets where the price is determined by the biddings of buyers and sellers.

Bankers’ Acceptance Notes: are financial instruments created by banks to facilitate transactions between international borrowers and lenders.

Barter: is the exchange of one thing for another, when neither is “money.”

Benchmark Interest Rate: ...

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