The Introduction of the Practice of Securitization Allowed

question 43

Multiple Choice

The introduction of the practice of securitization allowed:

• A)banks to more safely assume subprime mortgage loans.
• B)the government to promote a sense of security in the banking industry.
• C)banks to more safely leverage their investments.
• D)All of these statements are true.

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Definitions:

Duty Of Loyalty

A legal obligation requiring individuals to act in the best interests of another party, typically in a fiduciary relationship.

Agency Relationship

A legal bond where one party, the agent, acts on behalf of another party, the principal, in a business transaction.

Irrevocable

Something that cannot be changed, reversed, or undone, typically referring to certain contracts, trusts, or agreements.

Coupled With An Interest

A right or benefit that cannot be taken away because it is legally attached to another property or contractual right.