During the financial crisis of 2007-2009 the interest rate on mortgage-backed securities had
a. increased and the Treasury interest rate had risen.
b. increased and the Treasury interest rate had fallen.
c. decreased and the Treasury interest rate had risen.
d. decreased and the Treasury interest rate had fallen.
b
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The downward slope of the aggregate demand curve shows that
A) a higher price level will cause planned purchase rates for final goods and services to be higher. B) an increase in aggregate demand reduces the long-run aggregate supply. C) a lower price level will cause planned purchase rates for final goods and services to be higher. D) an increase in aggregate demand increases the long-run aggregate supply.
Which of the following statements regarding the long-term equilibrium is TRUE?
A) As new firms enter a market, each existing firm increases the quantity it produces. B) Firms leave a market if they are making zero economic profit. C) Entry and exit stop when firms are making an economic profit. D) Entry and exit stop when firms make zero economic profit.