Quiz on Lesson ” A History Of The United States In Five Crashes (Scott Nations) “

Why was the Federal Reserve established?

A) To respond to the panic of 1907

B) To prevent stock market crashes

C) To lower interest rates

What were some flawed assumptions behind portfolio insurance in the 1987 crash?

A) That stock prices move smoothly

B) That there would be enough liquidity for all the sell orders to hedge against the downside

C) Both a and b

What type of security did rating agencies rate AAA despite consisting of subprime loans?

A) Municipal bonds

B) Corporate bonds

C) Mortgage-backed securities

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