Mortgage-backed securities are:
A. investments that people bought based on the equity of their homes.
B. tradable assets made up of packages of individual mortgages.
C. assets that were purchased based on the leveraged value of people's homes.
D. securities that are often purchased by homeowners.
Answer: B
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An appreciation of the U.S. dollar
A) makes our exports more expensive in terms of foreign currency and imports cheaper in terms of the dollar, increasing net exports. B) makes our exports more expensive in terms of foreign currency and imports cheaper in terms of the dollar, decreasing net exports. C) makes our exports less expensive in terms of foreign currency and imports cheaper in terms of the dollar, increasing net exports. D) makes our exports less expensive in terms of foreign currency and imports cheaper in terms of the dollar, decreasing net exports.
The fact that banks operate on a "sequential service constraint" means that
A) all depositors share equally in the bank's funds during a crisis. B) depositors arriving last are just as likely to receive their funds as those arriving first. C) depositors arriving first have the best chance of withdrawing their funds. D) banks randomly select the depositors who will receive all of their funds.