When a Mortgage Is Used as Collateral for the Issuance

question 7

Multiple Choice

When a mortgage is used as collateral for the issuance of a mortgage-backed security (MBS) ,the underlying mortgage is said to be "securitized." As of the end of 2010,approximately what percentage of residential mortgage loans in the U.S.was being sold into the secondary market and being used as collateral for the issuance of MBS?

• A)25%
• B)40%
• C)85%
• D)100%

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Definitions:

Sentry Duty

The act of guarding or watching for any danger or unexpected activity, typically in military contexts.

Context Effects

The influence of surrounding factors or the situational environment on the perception, interpretation, or memory of information.

Masking Stimuli

Visual or auditory stimuli that interfere with the perception of another stimulus, making it harder to detect or understand.

Subliminal Sensation

The process of responding to stimuli that are below the threshold of conscious awareness.