What is one reason for the high interest rates for home loans offered to those with low credit ratings?
A) Predatory lending practices
B) Those with lower credit ratings faced a restricted supply of loans, ceteris paribus.
C) Those with lower credit ratings typically demand greater loans, ceteris paribus.
D) Government regulation
B
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Opportunity cost can best be defined as the
a. money cost of a good or service. b. money cost plus interest on money borrowed to buy a good or service. c. cost of the resources used to produce a good or service. d. value of the best alternative forgone when the alternative at hand is chosen.
Which of the following is true?
a. Positive economics deals with how people react to changes in benefits, and normative economics deals with how people react to changes in costs. b. Positive economic statements are testable, but normative statements are not. c. Positive economic statements involve value judgments while normative economics focuses on whether a policy will achieve its intended objectives. d. Positive economic statements focus on policy issues while normative economics focuses on economic theory.