A mortgage loan that would allow a borrower to repay none of the principal of the debt over the first few (typically five or ten) years of the mortgage could be called
A. a "zero-down" mortgage.
B. a "zero-interest" mortgage.
C. an "interest-only" mortgage.
D. all of the options are correct.
Answer: C
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In the figure above, what is the size of the multiplier?
A) 0.25 B) $2 trillion C) 4.0 D) $0.5 trillion E) More information is needed to determine the size of the multiplier.
Economists estimated that the cross-price elasticity of demand for beer and wine is -0.83 and the income elasticity of wine is 5.03. This means that
A) beer and wine are substitutes and wine is a luxury good. B) beer and wine are substitutes and wine is an inferior good. C) beer and wine are complements and wine is a luxury good. D) beer and wine are complements and wine is an inferior good.
Assume a money multiplier of 3. If the Treasury finances a $30 million expenditure by selling securities to the Fed, the money supply could ultimately
A) rise by $3 million. B) rise by $10 million. C) rise by $30 million. D) rise by $90 million.
The growth rate of real GDP is best represented as
A) (Contribution from capital) + (Contribution from labor) + (Contribution from total factor productivity) B) (Contribution from capital + Contribution from labor) / (Contribution from total factor productivity) C) (Contribution from total factor productivity) / (Contribution from capital + Contribution from labor) D) (Contribution from capital) × (Contribution from labor) × (Contribution from total factor productivity)