Which of the Following Contradicts the Textbook's Account for the Causes

question 67

Multiple Choice

Which of the following contradicts the textbook's account for the causes behind the financial collapse of 2008?

• A)Bundles of mortgages were combined into collateralized debt obligations and sold as if they were sound investments.
• B)The greed of mortgage holders and individual investors led to the catastrophe.
• C)Several high ranking officials from banks and mortgage companies have been imprisoned for their role in the collapse.
• D)NINJA mortgages were issued by some mortgage companies.

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Definitions:

Net Increase

The amount by which something grows or goes up, calculated by taking total gains and subtracting any losses.

Inventories

The stock of goods or materials that a company holds for the ultimate goal of resale or production.

Investment

The purchase of new plants, new equipment, new buildings, and new residences, plus net additions to inventories.

Nominal GDP

The total market value of all goods and services produced in a country in a given period, measured using current prices without adjusting for inflation.