As the housing bubble began to burst in 2006-2008, investors would only buy mortgage-backed securities at high yields to compensate for higher perceived default risk. As a result::
A) banks suffered significant capital losses as the value of their holdings of mortgage-backed securities declined
B) funds available for mortgages increased
C) bank profits rose as they earned higher interest on mortgages
D) the price of mortgage-backed securities tended to rise due to the higher yields
A
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In order to maximize profits in the short run, a price taker should always produce at the output level where marginal cost is equal to price.
Answer the following statement(s) true (T) or false (F)
Why does the aggregate demand curve slope downward?
Estate taxes are paid by the heirs of an estate when the estate is valued over a certain amount
a. True b. False Indicate whether the statement is true or false
Society as a whole likely benefits from a decrease in poverty because:
A. if there are fewer people in poverty, the incentive to commit crimes falls. B. increased assistance to those in poverty raises their incentives to work. C. social programs to help the poor are a small portion of the U.S. government budget. D. if there are fewer families in poverty, there will be less demand for childcare.