Which of the Following Was a Major Problem with Subprime

question 31

Multiple Choice

Which of the following was a major problem with subprime mortgages?

• A)Housing costs remained low, making home ownership unattractive .
• B)The risk of defaults on these mortgages was higher .
• C)These mortgages were rarely offered by banks .
• D)The mortgages were limited to only the wealthiest borrowers .
• E)Banks made little money off of them, causing them to raise other fees .

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Definitions:

Beginning Balance

The amount of money in a given account at the start of a financial period.

Petty Cash Fund

A small amount of cash kept on hand for making immediate, minor expenditures.

Journal Entries

The recordation of financial transactions in a company's accounting system, typically involving a debit and credit entry.

Discrepancy

An inconsistency or difference that arises in the course of comparing two sets of figures or facts, often leading to questions that require resolution.