When bonds are issued by Ginnie Mae, Fannie Mae, and Freddie Mac, for what purpose are the proceeds typically used?

a.

Mortgages are purchased and resold individually to investors.

b.

Mortgages are purchased, pooled together, and then sold in small groups of three to five mortgages to wealthy investors.

c.

Mortgages are purchased, pooled together in large groupings, and then the pooled groupings are sold in pieces.

d.

Mortgages are purchased and resold, with the risk being evenly divided between the government agency and the purchaser.

The Truth In Lending Act of 1968 was passed with the goal to ensure which of the following?

a.

CRA certification

b.

the regulation of consumer credit information

c.

the limitation of unfair or abusive lending practices

d.

full disclosure of all the terms and costs of a loan

WordTechGuru Corporation issues bonds with a bond covenant that specifies a stated debt-to-equity ratio range that management must maintain and further requires management to provide financial information to bondholders, including the buying and selling of major assets. Which of these statements is most likely true of the bonds they are issuing?

a.

The bonds will likely have a call provision.

b.

The bonds will be considered more risky and thus have a higher interest rate.

c.

The bonds will likely be very long term.

d.

The bonds will be considered less risky and thus have a lower interest rate.

The goal of Regulation Q was to

a.

limit competition between banks.

b.

insure bank profitability.

c.

encourage banks to compete in ways other than the interest paid on their accounts.

d.

prevent bank panics.