Based on the rising housing prices of 2000-2005, many buyers opted for interest-only loans and variable rate mortgages with little or no down payment because
a. they expected short-term interest rates to fall substantially in the future and this would reduce their monthly mortgage payment in the years ahead.
b. variable rate mortgages are a good way to reduce the risk accompanying your investment when you plan to stay in the house for a long time.
c. they thought housing prices would continue to rise and therefore they would be able to sell the house for a profit within a couple of years.
d. they could easily recoup their investment, even if there was a downturn in housing prices in the future.
C
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Autarky refers to
A) a situation in which there is no trade. B) the equilibrium a nation reaches after trade begins. C) a situation in which nations trade goods and services. D) the location on a consumption possibilities curve.
Two of the most important factors that influence total factor productivity are
A) the stock of knowledge that the world possesses and the associated level of technology. B) the quantity and quality of labor available in an economy. C) capital accumulation and the total level of investment in an economy. D) population growth rates and the geographic location of the population.
A demand curve that is unit elastic everywhere is
a. linear and slopes downward b. linear and slopes upward c. vertical d. horizontal e. nonlinear
Interest on the government debt is an example of uncontrollable fiscal spending.
Answer the following statement true (T) or false (F)