When mortgage loans are securitized, they are
A) bundled together by financial institutions and sold to investors.
B) issued to borrowers with flawed credit histories.
C) issued to borrowers who fail to document their income.
D) guaranteed by the federal government.
Answer: A
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Why does economic theory predict that a perfectly competitive firm will produce at the point where price equals marginal cost?
a. This point provides an efficient allocation of society's resources. b. This point results in zero economic profit. c. This point maximizes profit for the firm. d. This point will minimize ATC for the firm.
Which of the following statements about gold jewelry and round-trip bus tickets to Bismarck, North Dakota, is most likely to be correct?
a. They are both inferior goods. b. Their demand curves probably are quite similar. c. They are complements. d. They are substitutes. e. They are unrelated.