reader-questions

reader-questions - Department of Economics University of...

Info iconThis preview shows pages 1–4. Sign up to view the full content.

View Full Document Right Arrow Icon
Department of Economics Spring 2011 University of California Economics 1 Berkeley Professor Olney QUESTIONS FOR DISCUSSION #1. “Subprime Mortgages: A Primer,” by Mara Lee. NPR.org , March 23, 2007. http://www.npr.org/templates/story/story.php?storyId=9085408 (accessed 1/17/2011) Note: the article was written in Spring 2007, before the housing market crashed a. What is a subprime mortgage? b. What is an ARM? c. As of Spring 2007, why were so many subprime borrowers defaulting on their mortgages?
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Department of Economics Spring 2011 University of California Economics 1 Berkeley Professor Olney QUESTIONS FOR DISCUSSION 2. “Financial Literacy 2007: Mortgages. Mortgage loan choices abound.” Bankrate.com , March 19, 2007. http://www.bankrate.com/finance/financial-literacy/mortgage-loan-choices-abound-1.aspx (accessed 1/17/2011) a. What is the difference between a 30-year fixed rate mortgage and an ARM? b. What is a 3/27 loan? For whom is a 3/27 or a 5/25 mortgage probably a good product? c. A negative option ARM is the fourth option listed for payment-option loans. What happens to the monthly mortgage payments of negative option ARMS when they are recast? Why do you think many people were and are worried about a new wave of foreclosures when a wave of option ARMs recasts in 2010 and 2011? For more on option ARMs, expected to be the next big shoe that will drop with a thud on the housing market, check these posts http://www.calculatedriskblog.com/search/label/Option%20ARM The chart in the reader that shows “Total Foreclosure % by Product Type” is taken from that blog: 0.jpg
Background image of page 2
Department of Economics Spring 2011 University of California Economics 1 Berkeley Professor Olney QUESTIONS FOR DISCUSSION 3a. “Health Lags in Haiti 1 Year After the Earthquake: Can a country already beset with a failing infrastructure rebound to beat cholera and bring 21st-century health services to its citizens?” by Katherine Harmon. Scientific American , January 12, 2011. http://www.scientificamerican.com/article.cfm?id=health-lags-in-haiti-anniversary (accessed 1/17/2011) 3b. Central Intelligence Agency, The World Factbook . Haiti (selected pages) https://www.cia.gov/library/publications/the-world-factbook/geos/ha.html (accessed 1/17/2011) a. Describe the condition of Haiti before the January 12, 2010 earthquake: its level of income per person, extent of poverty, population size, size of the labor force, primary economic activities. b. What was the effect of the earthquake on labor force, capital stock, and infrastructure in Haiti? Draw a production possibilities frontier for Haiti that shows the effect of the earthquake. Explain why you drew your graph the way you did. What did you put on the axes of your PPF? Why? c.
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 4
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 28

reader-questions - Department of Economics University of...

This preview shows document pages 1 - 4. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online