A security that pays the holder, should mortgage borrowers fail to repay their debts, is a
A. traditional, thirty-year fixed-rate mortgage.
B. credit-default swap.
C. pay-option adjustable-rate mortgage.
D. thirty-year U.S. Treasury bond.
Answer: B
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Some economists believe that a positive aggregate demand shock to an economy with large amounts of excess capacity and unemployment does not necessarily cause an increase in prices. Economists who adhere to this belief are followers of
A) Keynesian economics. B) Say's laws of economics. C) classical economics. D) supply-side economics.
Diseconomies of scale at the firm level occur
a. wherever the firm's long-run average cost curve is horizontal b. wherever the firm's long-run total cost curve is horizontal c. where marginal cost equals marginal revenue d. if a firm becomes "too large" e. if any of the firm's plants becomes "too large"