Which One of the Following Is Most Apt to Create

question 4

Multiple Choice

Which one of the following is most apt to create an environment that increases mortgage prepayments?

• A) home mortgage rates remain relatively steady
• B) home mortgage rates decline significantly
• C) number of homeowner's defaulting on their mortgages rises
• D) homeowner's have steady, secure employment at their current jobs
• E) number of employees being transferred for employment purposes declines

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Definitions:

Excess Demand

A situation in which the quantity demanded of a good or service exceeds the quantity supplied at a given price.

Queuing

The process of forming or waiting in a line, often applied to the theory studying the behavior of lines to improve service efficiency.

Rationing Mechanism

A system or method used to distribute scarce goods or services among competing users.

Price Floor

A government- or authority-imposed minimum price that can be charged for goods and services, typically above the equilibrium price, to prevent prices from falling too low.