Which of the Following Was NOT a Feature of Subprime

question 36

Multiple Choice

Which of the following was NOT a feature of subprime lending in the housing market in 2005?

• A) People took out loans that they could not afford.
• B) Banks discouraged subprime lending.
• C) Subprime lending made up 20 percent of the market.
• D) Mortgage terms often changed after a couple of years.

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Definitions:

Perfect Information

A situation in decision theory or games in which all participants have complete and accurate information about all aspects of the game or decision scenario.

Power Company

A business entity that generates, transmits, and distributes electricity to consumers.

Expected Value

The long-run average value of repetitions of an experiment it represents, often considered as the mean of a probability distribution.

Perfect Information

A situation in game theory or economics where all participants have full and equal knowledge of all relevant aspects.