Chapter 6

1) Additional demand causes a shift of the demand curve to the right.

True / False

2) As with rising prices supply increases, the supply curve has always a downgrade slope.

True / False

3) With increasing supply the equilibrium point shifts to the right and the price is decreasing.

True / False

4) The unique location profile of a real estate site including the quality of its exposure and accessibility to neighboring activities and infrastructure is called situs.

True / False

5) Mortgages are created between lenders and borrowers on the primary mortgage market.

True / False

6) A private corporation created by an act of Congress to stimulate and maintain the residential secondary market.

a) Government owned enterprise (GOE)

b) Government sponsored enterprise (GSE)

c) Government controlled enterprise (GCO)

d) Government leaded enterprise (GLE)

7) What of the following is not one of the new residential mortgage business model?

a) Find someone willing to loan you lots of money.

b) Use this money to invest in real estate

c) Sell these new mortgage loans on the secondary mortgage market.

d) Use the proceeds from selling mortgages to pay off your big loan.

8) The name for that market serving residential mortgage borrowers who do not qualify for standard hence prime mortgages.

a) Money market

b) Primary market

c) Subprime market

d) Stock market

Answers:

True, False, False, False, False, b), b), c)