In January of 2008, the average price of a gallon of milk was $3.87. In January of 2012, the average price of a gallon of milk was $3.58. What is this an example of?
A. inflation
B. interest
C. deflation
D. productivity
C. deflation
How does a compound interest rate differ from a simple interest rate?
A. Compound interest rates pay more interest over time.
B. Compound interest rates are calculated only once a year.
C. Compound interest rates are usually lower than simple interest rates.
D. Compound interest rates apply to home mortgages only.
A. Compound interest rates pay more interest over time.
Why do interest rates on home mortgages increase when demand for housing increases?
A. Banks look for ways to decrease incentives to buyers as much as possible when demand is high.
B.When the demand for mortgages increases, lenders can increase the cost of borrowing money.
C.Interest rates on home mortgages do not move in response to consumers’ actions.
D. When demand is high, interest rates decrease on most goods and services, including houses.