Which of the following statements reflect the primary change in the mortgage market that played the major role in creating the housing crises in 2007 through 2009?
A. low interest in the mid 2000's.
B. adjustable rate mortgages to low income citizens with low credit scores.
C. the large increase in interest rates in 2007.
D. the reduction in newly constructed housing.
B. adjustable rate mortgages to low income citizens with low credit scores.
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Using a graph of the classical labor market, illustrate the effects of a real wage existing in the market that is lower than the equilibrium real wage. What will eventually happen in this labor market if it is perfectly competitive?
What will be an ideal response?
The interest rate effect suggests that investment spending and planned aggregate expenditures fall when the general price level rises
a. True b. False Indicate whether the statement is true or false
A free trade area differs from a customs union in that
a. in a free trade area, members can establish their own tariff policies with respect to nonmembers b. in a free trade area, the rules are binding on members, but in a customs union they are mere guidelines c. a free trade area strives for low tariffs, but a customs union strives for high tariffs d. a free trade area uses a standardized currency, but in a customs union each nation retains its own currency e. the rules of a free trade area only apply to trade with nonmembers, but in a customs union the rules apply only to trade with members
A movement from one point to an another point on the same consumption function could be caused due to
a. changes in wealth. b. an increase in the general price level. c. decrease in the real interest rates. d. changes in disposable income.