Briefly explain the process of securitizing mortgages
What will be an ideal response?
The mortgage lender sells the loan to a government-sponsored enterprise or financial firm that bundle the mortgage with mortgages from other lenders, providing the basis for a mortgage-backed security.
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A negative externality
a. is a cost to a bystander. b. is a cost to the buyer. c. is a cost to the seller. d. exists with all market transactions.
One solution to long-run structural problems could involve:
A. moving along the domestic supply curve. B. shifting the domestic supply curve up. C. shifting the world supply curve up. D. shifting the world supply curve down.
In the equation 
is the _____.
A. dependent variable B. independent variable C. slope parameter D. intercept parameter
Refer to the diagrams. The numbers in parentheses after the AD 1 , AD 2 , and AD 3 labels indicate the levels of investment spending associated with each curve, respectively. All numbers are in billions of dollars. If the interest rate is 6 percent and the goal of the Fed is full-employment output of Q f , it should:
A. increase the interest rate from 6 percent to 8 percent.
B. decrease the interest rate from 6 percent to 4 percent.
C. decrease the interest rate from 6 percent to 2 percent.
D. maintain the interest rate at 6 percent.