Investors relied on the judgment of credit rating agencies because:
A)credit rating agencies were supposed to be experts in evaluating credit risk.
B)the information directly available to investors on mortgage pools was insufficient
C)credit rating agencies were supposed to do their due diligence and do a thorough review before rating a given security.
D)All of the above
E)a and c

Question

Quizplus · Accepted Answer

All of the options provided are reasons why investors relied on the judgment of credit rating agencies: they were considered experts in evaluating credit risk, the information available to investors was often insufficient, and these agencies were expected to conduct thorough reviews before rating securities.

Investors Relied on the Judgment of Credit Rating Agencies Because