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In Canada, an early symptom of the U.S. subprime mortgage market problem was the
____.
A) financial engineering of the asset-backed commercial paper market
B) freezing of the asset-backed commercial paper market
C) increase of the asset-backed commercial paper market
D) restructuring of the asset-backed commercial paper market
Answer: B
Diff: 3 Type: MC Page Ref: 196
Skill: Recall
Objective List: 9.3 Discuss the most recent financial crisis
The government bailout of troubled financial institutions occurred in the U.S. and many
other countries. Which country saw their banking system collapse requiring the government to
take over its three largest banks?
A) Iceland
B) England
C) Germany
D) Belgium
Answer: A
Diff: 1 Type: MC Page Ref: 196
Skill: Applied
Objective List: 9.3 Discuss the most recent financial crisis
Under the Montreal Accord investors ____.
A) froze losses to $200 million
B) agreed to a standstill period
C) were bailed out by the Bank of Canada
D) were bailed out by the CDIC
Answer: B
Diff: 1 Type: MC Page Ref: 196
Skill: Recall
Objective List: 9.3 Discuss the most recent financial crisis
Like a CDO, a structured investment vehicle pays off cash flows from pools of assets,
however, rather than long-term debt the structured investment vehicle backs ____.
A) commercial paper
B) Treasury notes
C) corporate bonds
D) municipal bonds
Answer: A
Diff: 1 Type: MC Page Ref: 196
Skill: Recall
Objective List: 9.3 Discuss the most recent financial crisis