"Subprime Mortgages" Refer to

question 4

Multiple Choice

"Subprime mortgages" refer to

• A)interest rates that are over and above the prime rate to risky borrowers.
• B)mortgages made to credit-worthy borrowers at low interest rates.
• C)mortgages made to borrowers who do not usually qualify for loans.
• D)mortgage brokers making huge commissions on volume.

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Definitions:

Supremacy Clause

A clause in the U.S. Constitution stating that federal law is the "supreme Law of the Land" and takes precedence over state laws.

Federalism

A system of government in which power is divided between a central authority and constituent political units, such as states in the U.S.

Unitary

Refers to a centralized governmental structure where local or provincial divisions have little independent power outside the central authority's directives.

Confederal

Relating to a confederation, which is an alliance between sovereign states, where the central authority has limited powers and the member states retain a high degree of autonomy.