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Following the U.S. financial crisis in 2008, some observers assert that the policies of Fed Chairman Greenspan contributed to the crisis. Which of the following is a criticism of Greenspan's policies?
I. The very low interest rates used to fight the 2001 recession were maintained for too long, leading to the real estate bubble.
II. The Fed provided real estate developers with liquidity to encourage property development and offered tax breaks to first-time home buyers, which in turn fueled the real estate bubble.
III. The Fed did not promote appropriate regulations to deal with the new financial instruments that were created in the early 2000s.
Parameter
A quantity that defines certain characteristics of a system or function, often used in mathematical or statistical models.
Poisson Distribution
A probability distribution that expresses the probability of a given number of events occurring in a fixed interval of time or space when these events occur with a known constant mean rate and independently of the time since the last event.
Discrete Probability Distribution
A mathematical function that provides the probabilities of occurrence of different possible outcomes for a discrete random variable.
Caffeine-Free
Products or substances that contain no caffeine, often referring to beverages or foods.
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