Which of the Following Is Not an Example of Aggressive

question 8

Multiple Choice

Which of the following is not an example of aggressive lending practices that contributed to the subprime crisis?

• A)Mortgagors were not required to make any down payment at the inception of the loan.
• B)Loans were given to people with poor credit histories.
• C)Loans were given to people with no income.
• D)A borrower could get a second mortgage and use it as down payment.
• E)None of the above

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Definitions:

Freedom To Farm Act

A U.S. federal law enacted in 1996 aimed at allowing farmers greater management flexibility in what they plant and produce.

Agricultural Price Supports

Government interventions to stabilize or increase agricultural product prices through mechanisms such as subsidies or purchase commitments.

Acreage Allotments

A pre-1996 government program that limited the total number of acres to be used in producing (reduced amounts of) various food and fiber products and allocated these acres among individual farmers. These farmers had to limit their plantings to the allotted number of acres to obtain price supports for their crops.

Parity Ratio

is a measurement used to compare the value of one thing against another, often in agriculture or finance.