Mortgage lenders often resell mortgages in secondary markets. How might this make lenders act differently than if they intended to hold the mortgages themselves?
What will be an ideal response?
Lenders would be more likely to grant mortgages if they intended to resell the mortgages than if they intended to hold them. Reselling reduces the risk of granting mortgages because lenders no longer need to worry that borrowers will default on their mortgage loans.
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Refer to Figure 17-6. Which of the following statements about Scheme II is false?
A) It is likely to draw highly productive workers who see the opportunity to increase their wages. B) It allows workers to increase their monthly wage without penalizing those who are content with their monthly wage. C) It is more risky for senior employees. D) It could discourage less productive workers and induce them to leave the firm.
In 1921, prices surged, causing a decrease in average real wages
Indicate whether the statement is true or false