"Zombie S&Ls" paid above market interest rates to attract deposits, offered loans at below market interest rates to expand their lending, and drove down the profitability of solvent S&Ls, threatening to turn them into "zombies" too. Therefore, they did all of the above.

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"Zombie S&Ls

Question 19

Multiple Choice

"Zombie S&Ls"

A) paid above market interest rates to attract deposits to fuel their lending boom.
B) offered loans at below market interest rates to expand their lending.
C) drove down the profitability of solvent S&Ls, threatening to turn them into "zombies" too.
D) did all of the above.
E) did only A and B of the above.

Correct Answer: