Financial Risk Manager Part 1
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A risk analyst is studying the history of the subprime mortgage crisis that took place in the US between 2007 and 2009. The risk analyst finds that the delinquencies of subprime mortgages rose significantly after mid-2005. Which of the following was a contributing factor for the increase in delinquencies?
A
Mortgages became increasingly over-collateralized in 2005.
B
Interest rates decreased significantly throughout 2005.
C
Many first-time home buyers paid zero down payment in 2005.
D
Housing prices began to rise sharply at the end of 2005.