Which of the following statements is true about the high rate of mortgage defaults that contributed to the ﬁnancial crisis of 2007-2008?

Question

Quizplus · Accepted Answer

Banks had become lax in their lending practices and had issued a large number of bad loans, which led to a high rate of mortgage defaults. This, in turn, contributed to the financial crisis of 2007-2008. While high interest rates and the efforts of the government to discourage new home ownership and slow the growth of the housing bubble may have played some role, they were not the primary causes of the crisis. The two years of recession preceding the mortgage default crisis were also a contributing factor, but not the primary cause.

Which of the Following Statements Is True About the High