Multiple Choice
The increase of sub-prime (including Alt-A) loans as a share of the total from 2001-2005 was an important contributing factor to the economic crisis of 2008 because
A) these loans initially reduced the demand for housing.
B) these loans initially reduced housing prices.
C) the default and foreclosure rates on these loans are several times higher than conventional loans to prime borrowers.
D) the default and foreclosure rates on these loans are considerably lower than conventional loans to prime borrowers.
Correct Answer:
Verified
Correct Answer:
Verified
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