Question
Which of the following is true concerning collateralized mortgage obligations (CMO) ahead of the 2008-09 U.S. financial crisis? Select one: A. All subprime mortgage bonds
Which of the following is true concerning collateralized mortgage obligations (CMO) ahead of the 2008-09 U.S. financial crisis?
Select one:
A. All subprime mortgage bonds were pooled together in a single CMO tranche.
B. Once a CMO was created and rated, it became ineligible for further securitization.
C. A low-rated group of securities could never be given a higher rating in a CMO tranche.
D. None of the above
During the 2008-2009 U.S. financial crisis:
A. Banks' balance sheets strengthened with the increase in availability of credit
B. The value of such financial derivatives as mortgage-backed securities (CMO) increased significantly
C. There was a significant increase in the number of home mortgage defaults
D. All of the above
Which of the following statements is true on the eve of the 2008-09 U.S. financial crisis?
a. The supply of existing homes in the U.S. reached a nearly 11 month "overhang"
b. Home prices increased significantly beyond historic norms
c. Subprime mortgage lending spiked upward
d. All of the above
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