Which statement best describes loans with longer repayment periods?
Loans with longer repayment periods have lower monthly payments, lower interest rates, and lower costs of borrowing.
Loans with longer repayment periods have lower monthly payments but higher interest rates and higher costs of borrowing.
Loans with longer repayment periods have higher monthly payments, lower interest rates, and lower costs of borrowing.
Loans with longer repayment periods have higher monthly payments, higher interest rates, and higher costs of borrowing.
7 answers
Loans with longer repayment periods have lower monthly payments but higher interest rates and higher costs of borrowing.
What is the marginal propensity to consume?
It is the proportion of each dollar of income earned that is spent.
It is the proportion of each dollar saved that is spent.
It is the proportion of each additional dollar of income earned that is saved.
It is the proportion of each additional dollar of disposable income earned that is spent.
It is the proportion of each dollar of income earned that is spent.
It is the proportion of each dollar saved that is spent.
It is the proportion of each additional dollar of income earned that is saved.
It is the proportion of each additional dollar of disposable income earned that is spent.
The marginal propensity to consume is the proportion of each additional dollar of disposable income earned that is spent.
Summarize the effect of rising interest rates on consumers and businesses making purchases.
Businesses continue to make large purchases as their rate of return on their savings increases. Consumers generally tend to delay making major purchases as they benefit from a greater rate of return on their savings.
Consumers and businesses may finance large purchases while interest rates are still low. However, they are more likely to delay making major purchases and save for them with a greater rate of return on their savings.
Consumers and businesses continue to finance large purchases using loans with fixed interest rates but also enjoy a greater rate of return on their savings.
Consumers are more willing to finance large purchases while interest rates are still low, but their consumption is not affected. Businesses are more likely to delay making major purchases by saving for them using the greater rate of return on their stock investments.
Businesses continue to make large purchases as their rate of return on their savings increases. Consumers generally tend to delay making major purchases as they benefit from a greater rate of return on their savings.
Consumers and businesses may finance large purchases while interest rates are still low. However, they are more likely to delay making major purchases and save for them with a greater rate of return on their savings.
Consumers and businesses continue to finance large purchases using loans with fixed interest rates but also enjoy a greater rate of return on their savings.
Consumers are more willing to finance large purchases while interest rates are still low, but their consumption is not affected. Businesses are more likely to delay making major purchases by saving for them using the greater rate of return on their stock investments.
Consumers and businesses may finance large purchases while interest rates are still low. However, they are more likely to delay making major purchases and save for them with a greater rate of return on their savings.
What are possible effects on home ownership from an increase in the federal funds rate? Explain.
The cost of borrowing on a mortgage increases, which leads to higher lending costs for first-time home buyers.
The cost of borrowing on a mortgage decreases, which allows more first-time home buyers to be homeowners.
Fewer first-time home buyers are able to purchase a home because higher interest rates on mortgages lead to higher home prices.
The cost of borrowing on a mortgage increases, leading to less accessibility of home ownership for first-time home buyers.
The cost of borrowing on a mortgage increases, which leads to higher lending costs for first-time home buyers.
The cost of borrowing on a mortgage decreases, which allows more first-time home buyers to be homeowners.
Fewer first-time home buyers are able to purchase a home because higher interest rates on mortgages lead to higher home prices.
The cost of borrowing on a mortgage increases, leading to less accessibility of home ownership for first-time home buyers.
The possible effect on home ownership from an increase in the federal funds rate is that the cost of borrowing on a mortgage increases, leading to less accessibility of home ownership for first-time home buyers. When interest rates rise, the cost of obtaining a mortgage loan also increases. This means that potential home buyers may have to pay higher monthly mortgage payments, making it more difficult for them to qualify for a loan or afford a home. As a result, fewer first-time home buyers may be able to purchase a home due to the higher costs of borrowing.