Explain what mortgage-backed securities are and what the subprime mortgage market is. Discuss how the combination of

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Explain what mortgage-backed securities are and what the subprime mortgage market is. Discuss how the combination of these two financial innovations and low interest rates from 2001–04 contributed to the development of the housing bubble. Finally, explain why a rise in interest rates from 2004–06 burst the housing bubble and brought on the financial crisis of 2007–08.
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Macroeconomics

ISBN: 978-0138014919

12th edition

Authors: Robert J Gordon

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