In 2008, the liquidity of mortgage-backed securities declined significantly. Make use of a graph of the bond market to show how this affected the price of mortgage-backed securities

What will be an ideal response?


The lack of liquidity of mortgage-backed securities (MBS) led to a decline in the demand for MBS. As a result, there was a decline in the price of MBS.

Economics

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Which of the following statements about concentration ratios is correct?

A) A high concentration ratio indicates that the industry is a monopoly. B) A high concentration ratio indicates that the industry is monopolistically competitive. C) A high concentration ratio suggests that the industry is characterized by strategic independence. D) A high concentration ratio suggests that the industry is characterized by strategic dependence.

Economics

Government action can usually perfectly correct the market's shortcomings

a. True b. False Indicate whether the statement is true or false

Economics

Economic models are most often composed of diagrams and equations

a. True b. False Indicate whether the statement is true or false

Economics

One major aspect of the sociocultural-political environment of the United States that has generally been conducive to economic growth is the:

A. favorable attitude toward work and risk-taking. B. denial of the rights of property ownership. C. enforcement of contracts by the market. D. strict social regulation of production and progress.

Economics