The Tax Reform Act of 1986 eliminated the deduct·ibility of interest payments on consumer d.Wt (mostlycredit cards and auto loans) but maintained thedeductibility of interest payments on mortgages andhome equity loons. What do you think happened tothe :relative amounts of borrowing through consumerdobt and home equity debt?

The Tax Reform Act of 1986 eliminated the deduct·ibility of interest payments on consumer d.Wt (mostlycredit cards and auto loans) but maintained thedeductibility of interest payments on mortgages andhome equity loons. What do you think happened tothe :relative amounts of borrowing through consumerdobt and home equity debt?

Business/Professional Ethics Directors/Executives/Acct

8th Edition

ISBN:9781337485913

Author:BROOKS

Publisher:BROOKS

Chapter8: Subprime Lending Fiasco-ethics Issues

Section: Chapter Questions

Problem 6.1EC

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. What are some ways banks can state theircharges, and how should the cost of bankdebt be analyzed? In the early 1970s, Congressdebated the need for new legislation, and itended up passing a “Truth in Lending” law. Onepart of the law was the requirement that banksdisclose their APR. How is the APR calculated?Do you think the Truth in Lending law was reallynecessary?
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