The primary reason for Lehman Brothers' bankruptcy in September 2008 was its investment in:
A)subprime mortgages.
B)bonds of foreign governments.
C)U.S. government bonds.
D)risky stocks.

Question

Quizplus · Accepted Answer

Lehman Brothers invested heavily in subprime mortgages, which are loans given to borrowers who had poor credit histories and were considered high risk. When the housing market collapsed, many of these borrowers defaulted on their loans, causing Lehman Brothers to suffer huge losses and ultimately lead to its bankruptcy.

The Primary Reason for Lehman Brothers' Bankruptcy in September 2008