The widely publicized subprime lending crisis was NOT caused by
A) capital market participants who acted in their own self-interest.
B) a lack of transparency.
C) the practice of securitizing assets.
D) a lack of investor understanding of the investment's true risk.

Question

Quizplus · Accepted Answer

The subprime lending crisis was indeed caused by capital market participants acting in their own self-interest, a lack of transparency, and a lack of investor understanding of the investment's true risk. However, the practice of securitizing assets, while it played a role in spreading the risk and contributing to the crisis, is not inherently a cause of the crisis. It's a financial practice that can be used responsibly or irresponsibly, depending on the underlying assets and the transparency and understanding of the risks involved.

The Widely Publicized Subprime Lending Crisis Was NOT Caused by