The fact that the credit-rating agencies both advised clients on how to structure the financial instruments that paid out cash flows from subprime mortgages and also rated these financial instruments contributed to the:
A) subprime financial crisis that began in 2007.
B) Enron collapse.
C) demise of Arthur Andersen.
D) technology bust.
Credit Rating Agencies:
A credit rating agency assigns rating which evaluates a debtor's ability to repay a debt timely which includes principal and interest along with the possibility of default.S&P Global Ratings (S&P), Moody's, and Fitch Group are the main CRA,s in United States.
Answer and Explanation: 1
The correct option is A
Credit rating agencies (CRAs) played a key part in the subprime mortgage crisis in the United States in 2007-2008, which...
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fromChapter 8 / Lesson 10
A great way for companies with high credit ratings to raise short term cash for operating purposes is through commercial paper. Most large public companies issue commercial paper.