When the housing bubble occurred it can be attributed to all of the following except:
A. people expected housing prices to continue to rise.
B. it became easier to leverage more of a home's value, putting buyers more into debt.
C. the seller of the mortgage had lost incentive to properly assess the risk.
D. homeowners lack of confidence in the institutions who made the loan to them.
D. homeowners lack of confidence in the institutions who made the loan to them.
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The above figure shows the isoquants for producing steel. Increasing returns to scale are
A) present when producing less than 10,000 tons. B) present when producing less than 20,000 tons. C) present when producing less than 30,000 tons. D) never present.
If a bank that is subject to a 10 percent required reserve ratio has $20,000 in excess reserves, it can make new loans of:
a. $2,000 b. $18,000. c. $20,000 d. $200,000.
The MRP curve for labor:
A. is downsloping and shows the relationship between wage rates and the quantity of labor demanded. B. is perfectly elastic if the firm is selling its output competitively. C. is upsloping and lies above the labor supply curve. D. will shift location when the wage rate changes.
Following the balance of payments ________.
A. allows us to track changes in trade flows, but not financial assets B. is useful for understanding a country's relationships with its trading partners C. is not helpful because the balance of payments is always zero D. helps predict when an economy will be in a recession