During the Great Recession, securitization:
a. Was a major problem because it prohibited mortgage originators from reducing their underwriting mistakes by shifting them investors.
b.Was one of the only sources of relief for investors who were suffering heavy losses on their mortgage investments.
c. Was a major cause of the moral hazard problem.
d. None of the above.
.C
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For the capital stock of the economy to remain constant over time the amount of investment:
A) must exceed the depreciated value of capital stock. B) must be less than the depreciated value of capital stock. C) must be equal to the depreciated value of capital stock times the savings rate of the economy. D) must be equal to the depreciated value of capital stock.
Suppose the economy is initially operating at full employment. A reduction in the size of the budget deficit will cause which of the following in the long run?
A) a recessionary gap B) a reduction in real GDP C) an inflationary gap D) none of the above
Goods are scarce when:
a. their price is too low. b. their price is too high. c. the amount people want is more than the amount available at a zero price. d. people want less of something as compared to what is available. e. their prices are controlled.
Your college roommate receives a pay raise at her part-time job from $9 to $11 per hour. She used to work 10 hours per week, but now she decides to work 15 hours per week. For this price range, her labor supply curve is
a. vertical. b. horizontal. c. upward sloping. d. backward sloping.