Which of the Following Contributed to the Rising Mortgage Default

question 698

Multiple Choice

Which of the following contributed to the rising mortgage default and foreclosure rates and the eventual economic crisis of 2008?

• A) tightened mortgage lending standards and the reduction of loanable funds during 2001-2005
• B) the increase in the greed of Wall Street bankers and other commercial lenders
• C) the substantial increase in sub-prime and adjustable rate mortgages as a share of the total during 2001-2006
• D) the increase in the household savings rate during the two decades following 1985
• E) the increase in fixed rate mortgages as a share of the total during the decade prior to the crisis

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Definitions:

Wireless Speakers

Audio devices that use wireless technologies like Bluetooth or Wi-Fi to play music or other sounds from computers, smartphones, or other sources without the need for physical cables.

Supply of Mustard

The total amount of mustard that producers are willing and able to sell at various prices over a certain time period.

Price of Mustard

The amount of money required to purchase mustard, a condiment made from the seeds of the mustard plant, which can fluctuate based on factors like production costs and market demand.

Equilibrium Price

The cost at which the amount of a product sought by buyers matches the amount provided by sellers, achieving equilibrium in the market.