When housing prices fell during 2007, the mortgage default rate
A) declined as well.
B) responded in a similar manner as during other recent recessions.
C) increased substantially.
D) changed very little.

Question

Quizplus · Accepted Answer

The mortgage default rate increased substantially during 2007 as falling housing prices led to many homeowners owing more on their mortgages than their homes were worth, resulting in higher default rates.

When Housing Prices Fell During 2007, the Mortgage Default Rate