1) Alt_A borrowers were those who a) used mortgages to purchase apartments. b) c

ID: 1179562 • Letter: 1

Question

1) Alt_A borrowers were those who

a) used mortgages to purchase apartments.

b) chose adjustable-rate mortgages instead of fixed-rate mortgages.

c) borrowed using "interest-only" mortgages.

d) did not provide documentation of their income when applying for a mortgage.

2) The financial crisis of 2007-2009 worsened after the failure of which firm?

a) General Motors

b) Lehman Brothers

c) Bear Stearns

d) American International group

3) At the beginning of financial crisis, banks were hurt by all of the following EXCEPT

a) declines in the value of mortgage-backed securities.

b) defaults on mortgages by those with subprime mortgages.

c) holding too many Treasury bonds.

d) not being repaid on loans to real estate developers.

1)c) borrowed using "interest-only" mortgages.

2)b) Lehman Brothers

3)a) declines in the value of mortgage-backed securities.

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.