Which of the following was the catalyst for the recent financial crisis?
A) Corruption in the investment banking industry.
B) Widespread layoffs due to illegal alien hiring.
C) Defaults on subprime mortgages.
D) All of the options were catalysts.

Question

Quizplus · Accepted Answer

The defaults on subprime mortgages, which were given to borrowers with poor credit histories and high risk of default, triggered the financial crisis. These mortgages were then packaged into complex financial products and sold to investors, which spread the risk throughout the financial system. When housing prices began to fall and many borrowers defaulted on their mortgages, the financial products that contained these mortgages became worthless, causing many financial institutions to fail or require government bailouts.

Which of the Following Was the Catalyst for the Recent