An SEC Rule Change Allowing Investment Banks to Increase the Leverage

question 543

Multiple Choice

An SEC rule change allowing investment banks to increase the leverage of their investment capital prompted many investment banks to

• A) increase the amount of assets held in relation to mortgage-backed securities being issued.
• B) decrease the amount of assets held in relation to mortgage-backed securities being issued.
• C) decrease the amount of mortgage-backed securities being offered.
• D) reduce the ratio of mortgage loans to equity capital of the investment bank.

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