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In the Early 2000s, Credit Ratings of Mortgage Backed Securities

Question 62

Multiple Choice

In the early 2000s, credit ratings of mortgage backed securities turned out to be:


A) too low, which led many investors to them during the financial crisis.
B) accurate, but investors ignored the risk.
C) too high, as many securities contained far riskier loans than initially realized.
D) volatile, as it is hard to assess the risk of these securities.

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