Nationally, What Two Factors Caused the Bubble in the Real

question 67

Multiple Choice

Nationally, what two factors caused the bubble in the real estate market?

• A) high interest rates and high foreclosures
• B) low interest rates and low foreclosures
• C) low interest rates and loose credit standards
• D) tight credit standards and low interest rates
• E) adjustable rate mortgages and poorly constructed homes

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Definitions:

Encumbrance System

A system used in accounting to reserve portions of appropriated funds to avoid overspending, primarily used by governments.

Estimated Commitments

Obligations or contracts that a company is likely to incur in the future based on past or planned activities.

Journal Entry

A record in accounting that represents the recording of a financial transaction in a journal.

Restricted Funds

Funds that are constrained by external parties or legislation for specific purposes and cannot be freely used for any other expenditures.