Author Question: In 2008, the liquidity of mortgage-backed securities declined significantly. Make use of a graph of ... (Read 414 times)

tfester

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In 2008, the liquidity of mortgage-backed securities declined significantly. Make use of a graph of the bond market to show how this affected the price of mortgage-backed securities.
 
  What will be an ideal response?

Question 2

An order from an exchange for a seller to add enough funds to meet the minimum balance in a margin account is called:
 
  A) maintenance margin
  B) margin option
  C) margin call
  D) margin put



Ashley I

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Answer to Question 1

The lack of liquidity of mortgage-backed securities (MBS) led to a decline in the demand for MBS. As a result, there was a decline in the price of MBS.

Answer to Question 2

C



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