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61.In comparing the traditional way of structuring mortgages and the newer structure of providing mortgages that securitized them and insured those securities with credit default swaps , it is clear that the ____ structure allowed fewer people to afford homes and that  the ___ structure was safer to the health of the overall economy.

A)traditional; traditional

B)newer; newer

C)traditional; newer

D)newer; traditional

True False

62.“Exotic” mortgages require a down payment of at least 20%.

A)True

B)False

63.Monthly payments on “exotic” mortgages are constant over the life of the mortgage.

A)True

B)False

64.Asset price “bubbles” occur when buyers expect asset prices to increase in the future.

A)True

B)False

65.Location is a “fundamental” determinant of the price of any house.

A)True

B)False

66.Asset price “bubbles” are more likely to occur when interest rates are relatively low.

A)True

B)False

67.Monthly payments on “negative-amortization” mortgages typically increase over the life of mortgage.

A)True

B)False

68.“Negative-amortization” mortgages are best-suited to borrowers who are nearing retirement and expect their income to decrease in the future.

A)True

B)False

69.Asset price “bubbles” are sustained price increases driven by economic fundamentals.

A)True

B)False

70.Housing “affordability” is measured by the ratio of local housing price to local income.

A)True

B)False

71.Size and age are “fundamental” determinants of the price of any house.

A)True

B)False

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