Suppose you purchase a new home for $150,000, making a down payment of 10% and taking out a mortgage on the balance. What is the return on your investment in your home if one year later the price of your home decreases by 20%?
A) -10%
B) -30%
C) -50%
D) -200%
D
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Excess demand occurs:
A. when price is below the equilibrium price. B. when price is above the equilibrium price. C. whenever the market is not in equilibrium. D. whenever the market is in equilibrium.
A market is in equilibrium:
A. provided there is no surplus of the product. B. at all prices above that shown by the intersection of the supply and demand curves. C. if the amount producers want to sell is equal to the amount consumers want to buy. D. whenever the demand curve is downsloping and the supply curve is upsloping.
The most important function of money is when money is used as a
A. medium of exchange. B. standard of deferred payment. C. store of value. D. unit of accounting.
Suppose a new law makes illegal the sale of a good that had been legal. This will
A. eliminate deadweight loss. B. decrease consumer surplus. C. increase producer surplus. D. increase consumer surplus.