For a mortgage lender that makes mortgage loans to borrowers, which one of the following would be an example of moral hazard?
a. After the loan has been made, individuals become careless with their finances
b. Individuals most likely to default are the ones most likely to apply for the loan
c. Lenders performing a credit check on all potential borrowers
d. None of the above
a
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The purchase of government bonds by the Fed leads to a(n)
A) increase in the demand of bonds and a decrease in the price of bonds. B) increase in the supply of bonds and a decrease in bond prices. C) decrease in the demand of bonds and an increase in the price of bonds. D) decrease in the supply of bonds and an increase in bond prices.
The neoclassical growth model argues that the only way to increase growth in the long-run is
a. increase savings rates. b. reduce depreciation rates. c. reduce population growth. d. increase technology growth.