Real GDP

question 2

Multiple Choice

Real GDP

• A)fluctuates from year to year but is always below potential GDP.
• B)grows at a constant 3 percent per year.
• C)fluctuates around potential GDP.
• D)equals potential GDP when the price level is constant.
• E)equals potential GDP in the base year.

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Definitions:

Secured Party

A lender or seller who holds a security interest.

Mortgagor

The borrower in a mortgage agreement who pledges property to the lender as security for the loan.

Mortgagee

The lender or financial institution that provides a loan for the purpose of purchasing a property, holding a lien on the property until the mortgage is repaid.

Foreclosure

The legal process by which a lender takes control of a property, evicts the homeowner, and sells the home after the homeowner fails to make full principal and interest payments on a loan.