Problem1 if being a moneylender is as profitable as many, Ask an Expert

Economics

Problem

1. If being a moneylender is as profitable as many observers claim it is, give two reasons why moneylenders in low-income countries do not appear to operate in a competitive environment.

2. Moneylenders are known to charge exceedingly high interest rates.

a. Provide three alternative explanations as to why this might be the case.

b. Briefly assess the efficiency and equity of informal credit markets in light of your explanations.

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Microeconomics, Economics

Category:- Microeconomics
Reference No.:- M92754732

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