How Did Banks Contribute to the Recent Financial Crisis

question 163

Multiple Choice

How did banks contribute to the recent financial crisis?

• A) They began to offer investment products other than demand and time deposits.
• B) They provided loans higher than the discount rate.
• C) They made risky loans and then created mortgage-backed securities from the assets they held.
• D) They refused to sell anything other than fixed-rate mortgages.

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Definitions:

Environmental Performance

A measure of how well an organization or company is performing in relation to environmentally sustainable practices.

Stockholder Model

A theory of corporate governance focusing on the interests and rights of shareholders as the primary concern of the company.

Social Responsibility

The obligation of individuals, organizations, and businesses to act for the benefit of society at large, beyond their own interests or profits.

Management's Responsibility

The obligations and duties of managers to make decisions, guide teams, and ensure the successful operation and strategic direction of the organization.