In DSGE Models, the Passage of the Affordable Care Act

question 117

Multiple Choice

In DSGE models, the passage of the Affordable Care Act increased ________, which would be ________ shock today.

• A) uncertainty; negative
• B) health care costs; a positive transitory
• C) worker productivity; real wage
• D) certainty about health care costs; positive
• E) government debt; positive TFP

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Definitions:

Interest-Only

A debt repayment strategy where the borrower pays only the interest on the principal balance, with the principal balance unchanged.

Pure Discount Loan

A loan where the borrower receives a sum of money upfront and repays a higher amount at the end of the loan period, effectively paying interest by the difference.

Lump Sum Payment

An isolated financial disbursement occurring once, instead of being divided into multiple payments over a duration.

Annual Interest Payments

Periodic payments made to bondholders, typically annually, that represent the interest earned on the investment.