Herschel Borrowed $500 000 from Minah

question 26

Multiple Choice

Herschel borrowed $500 000 from Minah.As security for the repayment of that loan, a mortgage was created over a piece of land called Blackacre.Which of the following statements is TRUE?

• A)Herschel is necessarily required to pay interest on the primary debt.
• B)Herschel must have owned Blackacre at the outset.
• C)If the mortgage created a charge on Blackacre, that piece of land must have been located in a land titles system.
• D)Herschel must have borrowed the $500 000 from Minah for the purpose of buying Blackacre.
• E)If Blackacre is located in a registry system, then the mortgage should be registered only if there is a possibility that it will not be repaid within three years.

---

Definitions:

Money Supply

The collective sum of money in an economy, taking into account cash, coins, and balances within checking and savings accounts, at a specific timeframe.

Expansionary Monetary Policy

A policy by central banks to increase the money supply in order to stimulate economic growth.

Interest Rates

Interest rates are the cost of borrowing money or the reward for saving, typically expressed as a percentage of the principal amount per annum.

Economic Thought

The study and contemplation of various theories, models, and approaches regarding the functioning of economies and economic behavior.