Chapter 6

Chapter 6

Kasper Hovannisian

Fin 180

1. The most productive use of a property which leads to its maximum value is:

A. Highest and Best Use

B. Situs

C. Efficiency

D. Productivity

2. Which is not a characteristic of a perfectly competitive market:

A. Perfect Knowledge

B. Free Market

C. Homogeneous Product

D. All of the above are characteristics of a perfectly competitive market

3. What is the process of creating a mortgage-backed security?

A. Government Sponsored Enterprise

B. Disintermediation

C. Mortgage Securitization

D. Efficiency

4. Fannie Mae and Freddie Mac are part of the secondary mortgage market.

T/F

5. Subprime market serves residential mortgage borrowers who qualify for standard mortgages.

T/F The subprime market serves borrowers who do not qualify for standard mortgages.

6. Fannie Mae and Freddie Mac are government sponsored enterprises.

T/F

7. The current housing crisis can be blamed on one particular person or industry.

T/F As the book states, blame can be placed on a number of people and industries.

8. In the 1960's the S&L made up 2/3 of the residential lending.

T/F