A mortgage loan that would allow a borrower to pay less than the full interest accrued on the debt over the first few (typically five or ten) years of the mortgage could be called
A. a "negative-amortization" mortgage.
B. a "zero-interest" mortgage.
C. an "interest-only" mortgage.
D. all of the options are correct.
Answer: A
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Explain the rational expectations hypothesis
What will be an ideal response?
Which of the following must decline if there is a reserve deficiency in the banking system?
A) Demand deposits B) Reserves C) Net worth D) The demand deposit multiplier
When output exceeds its full-employment level,
A) the short-run aggregate supply function shifts up. B) wages fall. C) the short-run aggregate supply function shifts down. D) aggregate supply exceeds aggregate demand.
Suppose the demand for a good is currently unit elastic over the relevant range. Then the producer of a substitute good goes out of business and stops producing it. As a result, demand over that range is now likely to be a. Unit elastic
b. Relatively elastic. c. Relatively inelastic. d. Perfectly inelastic.