Which of the Following Scenarios Is an Example of Securitization

question 37

Multiple Choice

Which of the following scenarios is an example of securitization?

• A)A bank issues more common shares to the public.
• B)A multinational manufacturing company sells fixed income securities to a European pension fund in a private deal.
• C)A bank creates fixed income securities using the receivables from mortgages on residential property, and sells them to a fixed income mutual fund.
• D)The Government of Canada sells 25-year Treasury bonds to raise funds for infrastructure.

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Definitions:

Kelly's Covariation Theory

A psychological theory that explains how people attribute causation based on the consistency, distinctiveness, and consensus of an observed behavior.

Causal Attributions

The process by which individuals infer the causes of their own and others' behaviors, actions, and events.

Distinctiveness

The quality of being uniquely different from others in some respect, often used to describe features that distinguish one person, group, or thing from another.

Causal Hypothesis

A statement predicting a precise relationship between two or more variables, where changes in one variable cause changes in another.